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STRATEGIC MARKETING LEADERSHIP PROGRAMME AT

THE GLOBAL LEADERSHIP CENTRE

• What is Marketing• The Holistic Marketing Concept• Why is Marketing important for an

Organisation like Standard Bank• Case Study – Sierra National Bank• Branding, Differentiating and

Positioning

AGENDA FOR PROGRAM

AGENDA FOR PROGRAM. AGENDA FOR PROGRAM. contdcontd

• Major highlights of the Marketing Plan• The importance of the Promotional Mix• Case study – ABSA Free internet banking• Case study – Capitec Bank• Distilling the Standard Bank brand DNA and

the evolution of Marketing thinking and practice

What is Marketing?

ARE YOU IN MARKETING?

• WHO HERE IS IN MARKETING?

• IS MARKETING TOO IMPORTANT TO BE LEFT UP TO THE MARKETING DEPARTMENT?

• WHY?

ARE YOU IN MARKETING? What is the function of marketing within an

organisation? What is that perception of the rest of the organisation?

“Marketing is much too important to leave to the Marketing department … In a truly great marketing organisation, you cannot tell who is in the marketing department. Everyone in the company has to make decisions based on the impact on the CUSTOMER”.

Marketing begins with top management. If top management is not convinced of the need to be customer minded, how can the marketing idea be accepted and implemented by the rest of the company.

WHAT MARKETING IS NOT ?

• IT IS NOT JUST ADVERTISING AND SALES

• IT CERTAINLY IS NOT JUST AN ADD ON DEPARTMENT?

• IT IS NOT JUST ABOUT PRODUCTS AND SERVICES

• IT IS NOT JUST PR AND PARTIES

MARKETING DEFINEDMARKETING DEFINED

Marketing is the process of planning and executing the conception, pricing, promotion, and distribution of ideas,

goods, and services to create exchanges that satisfy individual and

the firm’s goals.

MARKETING IS ABOUT:MARKETING IS ABOUT:

• Anticipating and satisfying customer needs

• By means of mutually beneficial exchange processes, and

• Doing so profitably and more effectively than competitors

• By means of effective managerial processes.

AnticipatingNeeds

SatisfyingNeeds

Mutually beneficialExchange

More Profitably

More Effectively

Managerial Processes

Customer

Chosen Industry

Visual Summary

TO SUMMARISE:TO SUMMARISE:

• Marketing refers to the activities that provide need-satisfying products to buyers at profit - the reward for creating a satisfied customer

• It’s a philosophy, an attitude, it’s a management orientation, it becomes a culture

• End result is satisfied customers and sellers

WHY IS CUSTOMER WHY IS CUSTOMER SATISFACTION SO IMPORTANT? SATISFACTION SO IMPORTANT?

CUSTOMER SATISFACTION:CUSTOMER SATISFACTION:• Cheaper to keep a customer than acquire a

new one• Base profit from existing products/services• Revenue Growth as customer earns more

and expands the relationship• Cheaper to serve over time• Increased business from referrals• Premium pricing as customers become

brand loyal

1 - 14

THE IMPORTANCE OF CUSTOMERSTHE IMPORTANCE OF CUSTOMERS

CustomerValue

CustomerValue

Building Long-Term

Relationships

Building Long-Term

Relationships

CustomerSatisfactionCustomer

Satisfaction

Companies Create Competitive

Advantage by Stressing Customer

Importance

Companies Create Competitive

Advantage by Stressing Customer

Importance

One of the strategic roles of Marketing then is the art of

attracting and keeping profitable customers and doing this by maximizing customer lifetime

value!!!!!!

The ability to grasp and create new opportunities by getting closer to consumers and anticipating their

needs and the shifts in their needs ahead of the competitors can yield an important competitive

advantage

CREATING A SUSTAINABLE COMPETITIVE ADVANTAGE FOR

ORGANISATIONS LIKE STANDARD BANK

• You have to be something special to someone

• This Special relationship must be sustainable over time

• Must be based on dimensions that are important to customers

CREATING A SUSTAINABLE COMPETITIVE ADVANTAGE

You still have to pose the question however…

Will your competitors outperform you because they have an ability to deliver Perceived Superior Customer Value greater than yours over a protracted period of time? And create a Sustainable Competitive Advantage?Remember perception is reality!

SOURCES OF COMPETITIVE ADVANTAGE THAT SOURCES OF COMPETITIVE ADVANTAGE THAT CAN LEAD TO ACAN LEAD TO A SUSTAINABLE COMPETITIVE SUSTAINABLE COMPETITIVE

ADVANTAGEADVANTAGE1. Service quality e.g., British Airways

2. Customer value e.g., Toyota, Mr Price

3. Customer satisfaction e.g., In banking – Who??

4. Customer oriented personnel e.g., Avis, Disney,

5. Well-trained employees e.g., Fedex

6. Others, cost, quality (Mercedes), flexibility, location (V&A), safety (Volvo), exclusivity (Gucci), product design (Gillette), Distribution (SAB)

The Holistic Marketing Concept

If you truly want to maximise customer lifetime value, isn’t it time you reviewed

theDOMINANT LOGIC OF YOUR

COMPANY?

Are you a product driven organisation?

Are you a sales driven organisation?

Shouldn’t you be a Market Orientated organisation?

Evolution of Marketing

a). b).

Marketing dept

Operations

Information technology

Human resources

Administration

Finance

Operations

Marketing core

Human resources

Finance

Information technology

Administration Marketing

(a) Marketing as a ‘bolt-on’ discipline; (b) Marketing as a management philosophy

DOMINANT LOGIC IN TODAY’S ORGANISATION

Philosophy Key FocusProduct Product features and product quality

Sales Techniques to overcome customer resistance

Marketing Just good enough to have a marketingDept. Orientation department

Market Orientation Satisfying customer needs and wantsat a profit

HOLISTIC MARKETING CONCEPT

THE HOLISTIC MARKETING CONCEPT

has four pillars:-

• Relationship marketing – Focussing on customer wants through real Customer Management of Relationships via customers, channels and partners

• Integrated Marketing through all the firm’s activities to satisfy needs and wants

• Socially Responsible Marketing with ethics, legal community and environment as drivers

• Internal Marketing focusing on a company wide marketing approach


The Holistic Marketing concept recognises that everything matters with Marketing

• Organisations like Standard Bank need to market to a variety of stakeholders including staff, customers and stakeholders

• Holistic marketing incorporates Internal marketing ensuring that everyone in the Bank embraces appropriate marketing principles especially senior management

• Interrnal Marketing is the task of hiring, training and motivating staff who want to serve customers well


• Smart marketers recognise that marketing activities within the organisation can be just as important as the external marketing drive

• It makes little sense to promise excellence in service before the staff is ready to perform

• Internal marketing must takes place on 2 levels• The various different marketing functions must

work together eg Sales, customer service, research• Marketing must be embraced by other departments

They must think customer!!!• Remember, Marketing is not a department so much

as a company wide orientation

SOCIAL RESPONSIBLE MARKETING AT

STANDARD BANKFlagship Projects (2005)

1. Financial Literacy – R 3.8m Increase financial literacy & improve financial

management skills in SA 2. Mindset – R 3.5m Educational Resource development through

Mindset in Africa 3. Marang Centre for Maths and Science at Wits – R1.2 m

4. City Year – R 750k – addressing socioeconomic problems affecting SA Youth

Organisations who have successfully implemented the Marketing Concept

?

Discovery Health Virgin Group

Harley Davidson

Red Bull and

Standard Bank ?????

If the implementation of the Marketing Concept in Standard

Bank is not “High on your Agenda”, how can your

Organisation expect:

• To build a meaningful Customer Relationship Management or Customer Management of Relationships platform

• To look for New Opportunities in the External Business Environment

Why is Marketing important to an Organisation like Standard

Bank?

IMPORTANCE OF MARKETING Latest Challenges Facing Marketers

Customers are growing more sophisticated and price sensitive

They are short of time and want more convenience

They see growing product parity among the suppliers

They have high service expectations They have decreasing supplier loyalty


Getting better financial measures of the impact of marketing programs

Developing more integrated information about important customers

Getting marketing to be the company’s designer and driver of market strategy

Facing lower cost/higher-quality competitors

Coming under attack from International Competitors


1. How can we spot and choose the right market segments(s) to serve?

2. How can we differentiate our offering from competitive offerings?

3. How far can we go in customising our offering for each customer?

4. What are the major ways in which we can grow our business?

5. How can we build stronger brands?6. How do we create the right customer

experience?


7. How can we reduce the cost of customer acquisition and keep them loyal for a longer period of time?

8. How can we tell which customers are more important?

9. How can we measure the payback from advertising, sponsorships and public relations?

10. How can we price and distribute our products and services correctly?

IMPORTANCE OF MARKETING What Marketers need to do from a

strategic viewpoint?

1. They must study customer needs and wants and develop them in to well-defined market segments

2. They must allocate marketing effort in relation to the long-run profit potential of the targeted segments

3. They must develop winning offers for each target segment

4. They must measure company image and customer satisfaction on a continuous basis

IMPORTANCE OF MARKETING What Marketers needs to do from a

strategic viewpoint?

5. They must continuously gather and evaluate ideas for new products and services, product improvements, and services to meet customers’ needs

6. They must influence all company departments and employees to be customer-centred in their thinking and practice

IMPORTANCE OF MARKETING What all managers and employees

at Standard Bank need to do to drive up value for the organisation!

1. Create customer focus throughout the business.

2. Listen to the customer.



3. Make customers value superior value 4. Let customers define your quality 5. Measure and manage customer

expectations 6. Build customer relationships and loyalty

through Customer Management of Relationships and work toward the Customer Lifetime Value



7. Commit to continuous innovation and improvement

8. Manage culture along with strategy and structure

Most probably the most important question to be asked

is what is the takeout for the customer from the service

experience?

Standard Bank : Making a real difference by what our people do for you

Experience how our people can make

a real difference for you

We appreciate that it is people who reallymake the difference

You are the experience – so make a difference

Making a real difference

to the world around usby supporting

the people who do

CUSTOMERS STAFFSTAKE HOLDERS

A single point of difference :

Experience how our people can make a real difference for you

CUSTOMERS

Experience the way our people use the capacity of our

intellectual capital, network and balance sheet

to deliver great solutions for you.

Experience how we unlock

the synergyof our global network

of specialists & visionary thinkers

to deliver for you

Experiencethe way our teams

pull things together to give you

innovative solutions and peace of mind

Global MarketsInvestment Banking Banking and Trade Finance

So how would this work for the Business Units? TO

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SStandard Bank

Corporate and Investment Banking


CUSTOMERS

Experiencehow our people

consistently deliver great banking for you

Experience how our people use

their network, footprint,

systems, skills and products to

maximise your money

Experience how our people bring banking

to you in a way

that’s right for you

Branch BankingRelationship Banking Community Banking

So how would this work for the Business Units? TO

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Personal and Business Banking

What do we want our customers to say :

Take Out

It’s amazing what a difference the people at Standard Bank

have made to my banking- You must try it for yourself……


CUSTOMERS

IMPORTANCE OF MARKETING What types of Marketing is Standard

Bank involved in?

1. Organisation-Wide Marketing 2. Business Unit Marketing (CIB and PBB)

3. Value Propositional Marketing (Private Banking)

4. Product Marketing (Credit Card)


Bank involved in? 1.Organisation-Wide Marketing

Organisation-wide marketing that builds the long term corporate brand amongst all major stakeholders including customers and staff and gives leadership to Business Unit marketing functions

Connotes a concern with corporate entities. By implication it denotes a strong link with strategy and that responsibility resides with the CEO and board


Bank involved in? 1.Organisation-wide marketing cont/d

Has ten elements: - Philosophy and ethos (what we stand for) - Personality (Mix of subcultures) - People (Lifeblood of our identity) - Product (core business/es) - Price ( goodwill element in value and price)

- Place ( Distribution relationships/channels) - Promotion (Total corporate comms) - Performance ( Stakeholder Ratings ) - Perception and Positioning

(Image/Reputation)


Bank involved in? 2. Business Unit Marketing

- Marketing and communication strategies and projects that fulfil business unit objectives eg. events, advertising

agency liaison etc. - this could be domestic eg. PBB and CIB as

well as regional (Africa and Russia) and provincial.

- Must deliver on the overall brand strategy


Bank involved in? 3. Value Propositional Marketing

- Marketing and communication strategies that fulfil business unit

objectives for this group eg. Private Banking requires a much greater degree of

consultant availability and entrenches a one- to-one relationship eg. eventing, availability of client service support material, regular client contact etc. - High level of a Relationship Marketing

approach


Bank involved in? 4. Product Marketing

- Marketing and communication strategies that fulfil business unit objectives for example for the Credit Card business

unit.

Global marketsInvestment Banking

Banking & Trade finance

What type of Marketing? Business to Business Services

Standard Bank Corporate and Investment Banking

Organisation Wide Marketing

Products Products Products

Branch BankingRelationship Banking

Community Banking

What type of Marketing? Business to Consumer Services

Standard Bank Personal and Business Banking

Organisation Wide Marketing

Products Products Products

SERVICES MARKETINGCharacteristics of Services vs Products

1. Services are intangible so it is impossible for customers to sample a service before they buy it.

a) The promotional program must emphasise the benefits of the service, rather than the service itself.

b) Four promotional strategies that may be used to suggest service benefits are:i) Visualisation, showing the benefits of a service

directly - like people enjoying a holiday at a Mauritius resort.

ii) Association, connecting the service with a tangible good, person, object or place – such as Mo the Meerkat and his partner

iii) Physical representation, using something physical to portray the benefit from the service - such as an umbrella for short term cover at Santam.

iv) Documentation, using facts, figures or studies to support claims - like life assurer’s claim statistics

SERVICES MARKETINGCharacteristics of Services vs Products

2. Generally, the service and the creator-seller are inseparable. E.g. a hair stylist has to be present to create and sell a hair cut or a doctor must be on-site to perform an operation.

3. Services are variable. Each “unit” of a service will be somewhat different from other “units” of the same service.

4. Services are highly perishable and cannot be stored, and the market for services has fluctuating demand.

What benefits do customers see themselves receiving from being in an extended relationship with a service organisation like Standard Bank??

Remember, Customers buy solutions to their problems

BUSINESS TO BUSINESS MARKETINGCharacteristics of Service B2B Marketing

Relationships in a B2B service are largely dependent on the quality of the interaction between the individuals at each of the partnering organisations. As relationships strengthen over a period of time the service provider’s team often assume the role of an outsourced department and can even make critical decisions on behalf of the client.

Case Study: Sierra National Bank

Branding, Differentiation and Positioning

What is a Brand?

Brand* : A collection of perceived functional and emotional

benefits associated in the mind

of customers, clients, employees and stakeholders that adds to (or subtracts from) the perceived* value

of the product, service or relationship and that is managed over time.

Please note :

* Standard Bank = our brand

* Perception might not be reality but it is what drives behaviour

Brand Strategy: personality, iconography, architecture, positioning / DNA and messages

For Example :

*Branch experience and *HR practices

customer contact points *How we live our values

*Customer relationships *Sponsorship and CSI Involvement

*Product and service experience

*Workplace engagement

For Example :

*TV, Radio, Print, Cinema, PR *Internal Communications

*Customer call centres *Sponsorship communication

*Client events *Analyst presentations

*Promotions

*Direct marketing and On-line

Brand Perception: what they believe about usFor Example :

*Market research

*Tracking studies

*Staff temperature checks

*Stakeholder surveys

*Campaign evaluations

*Client surveys

Brand Reputation: what they say about usFor Example :

*Complaints

*Word of mouth

*Blogs

*Staff feedback

*Media articles

Brand Relationship

Act

ual B

rand

Inte

nded

Bra

nd

Marketing Structures, Functions, Resources, Budgets, Processes, Operations and Systems

Brand Experience: what we do

Staff Customers Stakeholders

Brand Communication: what we say

Enabled by :

The Elements of a Brand RelationshipBrand Relationship

“Making a real difference by what our people do for you”EX

PER

IEN

CE

&

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Seen to be a successful business

For Example: •Leader in industry

•Profitable/ Growing

•Outperform competitors

•Perception of Annual report and triple bottom line

Awareness and perceptions of products

and offeringsFor Example:

•Innovative

•Value for money

•Relevant solutions

•Better benefits

Perceived to be socially relevant

For Example:

•The way we do business

•Access to financial services

•CSI initiatives

•Community initiatives

•Charter compliance / BEE

•Supports things that are relevant to me

Maximising Brand and intangible equity

For Example:

•Consistent positioning

•Corporate Identity

•Trademarks

•Brand personality

•Sponsorship properties

•Effective use of media

Branch experience and client/ customer relationshipsFor Example:

•Consistent Interaction at all contact points and at all levels

•When, where and how we connect with them

•Processes/ systems

•Ongoing correspondence

Staff ExperienceFor Example:

•Employee proposition & opp.

•People practices

•Seen as great place to work

•Diverse working environment

•Attracts, retains and develops talent

LeadershipFor Example:

•Media profiling

•Behaviour of leadership

•Management style

•Internal communication

•Perceptions of leadership

Vision and ValuesFor Example:

•Long term growth objectives

•Culture of business

•Values I relate to

•Clear direction / goal

•Living the values

Staff Behaviour Customers Behaviour Stakeholder BehaviourSource: Adapted for Standard Bank context from

Fombrun, C.J. (1996). Reputation – Realizing Value from the Corporate Image. Harvard Business School Press.

Rational Connection

Emotional Connection+

Consistently delivered to ensure that customers, clients, staff and stakeholders choose us

Why brand is important

• Increases customer's willingness to pay a premium price• And continued willingness to pay a premium (loyalty)• Increases frequency of use• Increases share of wallet• Increases sales effectiveness• Reduces service failure sensitivity• Influences merger and acquisition decision-making• Influences share price• Insulates the brand from competitive threats – barrier to competitive entry• Brand equity enhances marketing successes – strong brands require fewer

ad exposures to meet communication objectives• Power base for negotiations with external suppliers• Allows for brand extension into other segments, categories or industries• Attract and retain quality employees

KEY CONCEPTS IN BRANDING1. Brand Equity - The total value that the brand

brings to a company over and above its net book value eg Coca cola has a brand equity of $68.5 bn

2. Brand Positioning - Brand Positioning is what the organisation’s offering and image does to occupy a distinctive place in customers minds (target markets) eg ABSA vs Nedbank vs Standard Bank

3. Brand Visual Identity- The way in which elements of the brand are made to appear externally by means of a corporate logo or symbol, a service, packaging and slogan

KEY CONCEPTS IN BRANDING4. Brand Protection- A registered mark that gives

the organisation the exclusive use of a name on a defined set of products or services in a specific or general category eg TM or ®

5. Brand Valuation – how the total value of the brand is estimated. Interbrand for example uses various criteria including the brand’s market position, age,nature and size of market, geographic spread, market trends, trademarks, consistency in advertising and promotion

6. Brand Experience – The total experience the customer has of the branded product or service eg, Virgin Atlantic pre- and in-flight services

BUILDING A BRAND Marketing communications positions the

brand promise to different audiences The importance of the brand must be

understood by all who manage it The brand promise must be reinforced by

everyone in all they do Brand awareness brand preference

brand use brand loyalty A sustained image is one of the greatest

legacies of brand equity

BRANDING?Brands matter to every company because

what a brand captures is distinctive – This is the primary source of your

company’s competitive advantage and the ability to create value

THE IMPORTANCE OF BRANDING

Can it really make a difference?• Do we just go with the flow of brand names that

have become synonymous with our daily lives…

• Examples: Nike, Coke, Vodacom, MTN, Levis, Mercedes Benz, Intel, Microsoft, Apple,

• Customers / Clients like brands to which they can

associate positive qualities

• Perception and Positioning play a vital role

THE IMPORTANCE OF BRANDING“Correct Perception is vital”

• Marketing is not just a battle of products and services… .it is a battle of perceptions!

• Coke versus Pepsi – The Cola Wars

• New entrants in the car market in South Africa

• LG and Samsung

• Apple with Steve Jobs or without Steve Jobs

THE IMPORTANCE OF BRANDING• Building Brand Equity – What tools can be

used? Owned word eg. Volvo, BMW, Mercedes, Fedex Slogan – tagline is hypnotic/subliminal eg. BMW, Standard Colours eg. Red, Blue, Yellow Symbols and logos and well known spokesperson Stories eg Fedex

A MONOLITHICBRAND

Read the article and answer the questions

TOP SOUTH AFRICAN BRANDSTOP SOUTH AFRICAN BRANDS

• Standard Bank (R10.165 bn)• MTN• Vodacom• Absa• First National Bank• Telkom• Castle Lager• De Beers• Old Mutual• Pick ‘n Pay (R2.318 bn)

Source: Interbrand

SOUTH AFRICA’S COOLEST BRANDS 25 - 44 YEARS OLD (2006)

1. Nike2. Coca Cola3. Levi’s4. Adidas5. Vodacom6. Nokia7. Puma8. MTN9. Samsung10.Reebok

TOP BRANDS IN SOUTH AFRICA 2006 – BANKS

Source –Brands and Branding 2006

1. ABSA2. Standard Bank3. FNB4. Nedbank5. People’s Bank6. Ithala7. African Bank8. Teba Bank9. NBS10.Perm

POSITIONING ANDDIFFERENTIATION

a. Positioning and differentiating are complimentary decisions.

b. Positioning refers to a product’s image in

relation to directly competitive products, as well as other products marketed by the company. How your product or message is perceived by customer. eg. SAB beers, German luxury vehicles, Nike vs others – sporting footwear.

c. We will deal with: - Positioning methods - Strategic Positioning alternatives - Perceptual Maps

POSITIONINGPOSITIONINGHow does the human mind work?How does the human mind work?

How do we get into the mind?

• In a mental contest the odds favour the first to mind–1st man on the moon–1st PC–1st man to break the 4 min mile

• If you don’t spring to mind first, you have a positioning problem

• But we can’t all be first, or can we?

POSITIONINGTop-of-Mind Awareness

• Avis was number two to Hertz• Avis positioned itself in relation to Hertz

–We are number two in care hire, but we try harder

• Avis occupies the “we try harder” space in the mind of the customer

• Is this a good place to be?

AVIS Rent a Car

Differentiation is the cornerstone of Positioning

What’s the relationship between Differentiation and Positioning?

The best variable that you can use to differentiate yourself is in fact the one that gives you a

competitive advantage.However an Organisation must be relevantly differentiated. That is it must occupy a unique

space in the minds of the customers.An Organisation gains a Competitive Advantage if

it succeeds in positioning itself as providing value to selected Target Markets

What’s the relationship between Differentiation and Competitive

Advantage?

Bases for Differentiation -Bases for Differentiation -ProductProduct

1. Features and benefits (Apple iPods)

2. Quality/performance (BMW)

3. Durability (Duracell)

4. Reliability and/or Repairability (Toyota)

5. Style or design (Alfa Romeo)

6. Product range (The Pro Shop)

Bases for DifferentiationBases for DifferentiationServices accompanying productsServices accompanying products

1. Delivery (Scooters 39 minute promise)

2. Installation (Otis elevators)

3. Customer Training (Standard Bank Online Share trading)

4. Consulting Services (Nashua online)

5. On-site Repairs (Caterpillar equipment)

6. Rewards ( FNB e-Bucks)

Bases for DifferentiationBases for DifferentiationServicesServices

1. Reliability (DHL)

2. Responsiveness (Netcare 911))

3. Assurance (Funeral schemes 48 hours payout)

4. Empathy (Airlines)

5. Tangibles (Décor in restaurants)

6. Banking???????

Looking at competitive messagingIs this differentiating ?

People

Products

About us For you

Enabling you to get what you want

Solutions to build your future

Convenient, cheap banking

Respectful & quality service delivery for all

Helping South Africans through innovationSimple, accessible

banking

The leaders globally

Bringing international expertise to your market

Success breeds success

The thinkers

Partnering with you to deliver solutions

VIP banking (for all)

Your International partner

Experience how our people can make a real

difference for you

Develop a Positioning Strategy

Positioning involves the following steps:

1. Company must identify differences that may be established in relation to competition.

2. Select the most important differences. 3. Communicate or signal to the target

market how the company differs from its competition.


A. Bases to position products In general, various positioning methods can be

distinguished. 1. Attribute Positioning / Customer Benefits The enterprise positions itself in terms of one or

more outstanding attributes or benefits. eg. Cell phones, Sage - first name in Unit Trusts.

2. Product Benefit Positioning This positioning method emphasises the unique

benefits that the enterprise or product offers eg. Gillette Fusion Razor. Promise an even closer shave. Colgate Total reduces cavities, tartar etc.

Develop a Positioning Strategy A. 3. Quality / Price Positioning

The enterprise may claim that its product is of exceptional quality, or has the lowest price. Stuttafords vs Pep Stores, Chivas Regal vs 100 Pipers.

4. Use / Application Positioning An enterprise can position itself on its market offering in terms of the product use or application possibility. Nike describes one of its shoes as the best for running, another best for X training, another best for soccer. Also Bar One for a 25

hour day

Develop a Positioning Strategy A. 5. User Positioning

The enterprise may position its products with users in mind, using models or personalities. Influences image of product by association eg. Halle Berry - Revlon girl, Carling Black Label & Camel for the “Real Man”.

6. Product Class Positioning Some marketers need to make critical positioning decisions that involve what product class or category the product falls in eg. Canderel sweetener against sugar, Red Bull against energy drinks, Hansa - leader in product class.


7. Competitor Positioning Some market offerings can best be

positioned against competitive offerings. BMW would find it

useful to position their cars directly against those of Mercedes Benz, as well as Audi, Volvo, SAAB etc. Also car hire. Are you better than your competitor?

8. Origin Positioning eg. Scotch Whiskey, Audi,

Perrier/Evian water, Boerewors

EXAMPLE OF USER POSITIONING

EXAMPLE OF BENEFIT POSTIONING

EXAMPLE OF PRODUCT CLASS EXAMPLE OF PRODUCT CLASS POSITIONINGPOSITIONING


Positioning Alternatives – Three options:

1. Entrench eg. Avis 2. Find a new position eg. Tata,

Chana 3. Reposition eg. BP, Toyota,

MTN, Pringle and of course Standard Bank

Highlights of the Marketing Planning Process

Now it’s timeto Plan!

MAJOR HIGHLIGHTS OF THE MARKETING PLAN

1. Executive Summary Main thrusts and recommendations of the plan (written

last)2. Situation Analysis

Short report on each of the following:1.1 Macro-environment (PEESTI+C)1.2 Market and customer environment – incl. Suppliers and

Intermediaries1.3 Industry and competitive environment 1.4 Internal (organisational) environment

3. SWOT Analysis *List the key strengths, weaknesses, opportunities and threats facing the organisation or business unit or product/brand.


4. Issues and Opportunities*Specify the Opportunities & Key issues flowing from the SWOT analysis that are critical and have to be addressed in the plan (both negative and positive).

5. Marketing Goals and Objectives4.1 Mission statement (optional)4.2 Marketing objectives

- Corporate - Marketing specific - Objectives emanating from Opportunities and

Key issues that have been developed


6. Strategy Development6.1 Competitive advantage6.2 Winning strategy/ies*

7. Marketing Strategy Portion of the Plan7.1 Segmentation and Target market(s)*7.2 Positioning strategy (as it relates to the brand personality and

emotional positioning that you want communicated) 7.3 Product and Service Offering?

How is it priced (what is charged?)Where can it be found? Place/DistributionHow can we communicate to our Key Customer Groups?*What should our people do?What process should be in place?What physical evidence is associated with our bank?

7.4 Setting Strategic decisions mix


7. Budgets

8. Action Plan for Each Strategy 8.1 What will be done?8.2 Who will be responsible?8.3 When will it be done?8.4 How much will it cost?

THE ANNUAL MARKETING PLAN

Setting Winning Strategies

The ability to grasp and create new opportunities by getting closer to

consumers and anticipating their needs and the shifts in their needs ahead of the competitors can yield an important

competitive advantage

THE ANNUAL MARKETING PLAN Setting Winning Strategies

1. Cost Reduction – Budget Household Insurance, Kulula.com, Online/ Virtual Banking

2. Improved Customer Experience – Starbucks, Harley Davidson

3. Highest Product quality – Toyota

4. Innovative Business Model – Fedex

5. Niching – High net worth woman’s bank


6. Product/Service Innovation – IPOD, ABSA Free Internet Banking

7. Overcoming Commoditisation – Mexican Cement company, Cemex

8. Design – Samsung, Bang & Olufsen

9. Grapevine – Buzz Marketing and word of mouth eg 94.7 and the Fugitive


10. The use of Lateral Marketing – MBA = train + classroom, and in Banking?

11. Upscale to Technology-Enabled marketing - Turn CRM into CMR, Make tellers

accountable for selling as well

12. Pay only for what you use – Hollard & Pay as you drive

13. Exploit the Internet – consultative, online focus groups, free research with a reward, new idea generation


a. You have to be something special to someone – your clients

b. Must be based on dimensions that are important to your clients

c. Must be sustainable over time

d. Novel ways of differentiation lead to competitive advantage

Eg. Outsurance, More legroom, Fetch Rover, Express checkout

THE ANNUAL MARKETING PLAN Segmentation, Target Marketing and

Positioning ( STP)

1. Identify segmentation variables and segment the market

2. Develop profiles of resulting segments

3. Evaluate the attractiveness of each segment

4. Select the target segment(s) and the strategy used

5. Identify possible positioning concepts for each target segment

6. Select, develop and communicate the chosen positioning concept

SEGMENTING CONSUMER MARKETSSEGMENTING CONSUMER MARKETS

Benefits

Psychographicpersonality, motives, lifestyles,

geodemographics

Demographicage, gender, family life cycle

Geographic

Behaviouralusage rate, occasions,

brand familiarity

Bases for SegmentingConsumer

Markets

Bases for SegmentingConsumer

Markets

THE ANNUAL MARKETING PLAN Target Marketing

A target market refers to a group of people or organisations at which a firm directs a marketing program.

a) How much and in what way the markets are going to be segmented must be determined.

b) Only those segments (parts of markets) showing the best potential for successful marketing should be pursued.

c) Size & growth potential of segments to be addressed.

d) Decide which Target Market Strategy to adopt ie. Undifferentiated, single segment or multiple segment.

8

Standard Bank Africa Segmentation Framework

Informal markets = Trader, Regular and Irregular Income Earners

irregularly paid with

Segment size estimates based on population 18+ years in countries where Standard Bank Africa operates

•Irregular Income Earners

• Wholesale (business turnover > USD 1 million, depending on country)

• Individuals earning over R16,000 - R20,000 per month (depending on country), employed by formal sector or self-employed (= Executive Banking)

• Individuals formally employed (e.g. employers are registered) earning less than R16,000 -R20,000 per month (depending on country)

• Individuals who are regularly paid a regular amount by non-formal employers

• Individuals earning income from small, non-registered business that they own / operate

Irregular Income Earners

Traders

Business, Institutions

Corporate, Institutions, Government

Affluent

Salaried

Regular

• Individuals who are

income typically less than R1,500 per month

• Individuals earning income from a registered business, that they own / operate (business turnover < USD 1 million, depending on country)

Standard Bank Africa Segmentation Framework

•Irregular Income EarnersIrregular Income Earners

Traders

Business, Institutions

Corporate, Institutions, Government

Affluent

Salaried

Regular

• Individuals who are irregularly paid with income typically less than R1,500 per month

• Individuals earning income from a registered business, that they own / operate (business turnover < USD 1 million, depending on country)

Informal markets = Trader, Regular and Irregular Income Earners

Segment size estimates based on population 18+ years in countries where Standard Bank Africa operates

Strategies for Selecting Target Markets There are three alternative strategies for selecting a Target

Market resulting from Segmentation. (You also do not have to enter market)

Market Aggregation (Undifferentiated)

Single Segment (Concentrated or rifle approach)

Multiple Segmentation

EXAMPLE OF MULTI-SEGMENT TARGETINGEXAMPLE OF MULTI-SEGMENT TARGETING

THE ANNUAL MARKETING PLANThe Marketing Mix – Excellence in

implementation of decisions for:

1. Products – Customer Value 2. Pricing – Customer Costs 3. Distribution – Customer convenience 4. Promotion – Customer Communication 5. People 6. Processes 7. Physical Evidence

THE ANNUAL MARKETING PLAN The Marketing Mix

1. The marketing mix (the controllable variables) is the combination of the product, how it is distributed, promote, its price, the people component, processes and physical evidence.

2. These four elements must satisfy the needs of the organisation’s target market(s) and also achieve its marketing objectives.a) Product. Strategic decisions must be

made regarding branding, packaging, product mixes, lines, development product life cycle etc.

b) Price. Strategies include price setting on items within a product line, terms of trade and possible discounts.


c) Distribution. Strategic concerned with making products available when and where customers want them.

d) Promotion. Decisions must be made as to advertising, public relations, personal selling and sales promotion, and how they will be rolled into a coordinated program.

e) Physical evidence. In order to add an element of tangibility, service marketers make use of physical evidence to create an atmosphere or image for a business


f) Processes. Delivering the service product is a process. If the process does not run smoothly, then there could be obvious delays or problems. Problems in processes can create a negative image.

g) People. People are crucial in projecting the right image of an organisation as well as in customer care. This requires detailed training

and staff motivation.

3. The seven marketing-mix elements are inter-related; decisions in one area affect actions in the other.

THE PRODUCT DECISIONSSome Questions to Ask When AnalysingProduct/Service Strategies.a. What are the major product/service offerings of

the firm? Do they complement each other?b. Where is the firm and each major product in its

life-cycle? Intro, growth, maturity & decline.c. What changes will we make to existing

products/services in terms of quality, features, packaging etc? What product mix strategies? Contract, expand, alteration via product alteration eg. quality, functionality or style modification, upward or downward.

d. What is the competitive differential advantage of this product?

e. Can this competitive differential advantage be sustained or can it easily be copied by competitors?

THE PRODUCT DECISIONS Some Questions to Ask When Analysing

Product/Service Strategies

f. What process does the organisation use to develop new products? Has it been successful?

g. What consumers make up the target market and what are their reactions to the product?

h. Is product symbolism or brand image an important factor in the market, and what is the image of the organisation’s product among consumers? Moving from brand experience brand recognition brand preference brand loyalty.

i. What product strategies are competitors using and how successful are they?

j. What areas of product or brand strategy needs improvement?

THE PRICING DECISIONS Use the following questions to help you

formulate your pricing strategies

a. How price sensitive are customers?b. Do consumers of this product use price as an

indicator of quality? Is it cost based, competitor based or customer based?

c. How will various prices affect the product or brand image?

d. What is the product’s life cycle stage and what influence does this have on pricing strategy?

e. What entry pricing strategies should be used?

THE DISTRIBUTION DECISIONS

Use the following questions to help formulate your distribution strategies a. What is the target market for this product and

where do these consumers usually purchase a product or utilise the service you offer.

b. What channels should be used in distributing product offerings? Are they direct or indirect?

c. What degree of market coverage is needed to reach the target market? ie. intensive; selective or exclusive.

d. How competent is the organisation to manage various service distribution points?

e. Should the organisation be adopting a defensive vs an offensive distribution strategy?

THE PROCESSES DECISIONSSome Questions to Ask When AnalysingProcess Strategies.a. Because services cannot be stored, what ways must

be found to handle peak loads and optimise different customer experience?

b. What can a bank like Standard Bank do channel cash only customers to ATMsduring work hours to free up expert help to handle more complex customer needs during peak hours? The same applies to express deposit queues.

c. How should service availability and consistent quality, in the face of simultaneous consumption and production of the service, be handled in service organisations?

THE PHYSICAL EVIDENCE DECISIONS

Some Questions to Ask When AnalysingPhysical Evidence Strategies.

a. How should customers experience a service? b. What physical assets should be visible to a customer

and what should be hidden( but may be critical) in order to maximise the service experience?

c. What natural internal facilities ie plants and dividers should be in place to help build the personality of the facility and give it personality?

d. What colours, lighting, fixtures, location of amenities should be included in the physical planning of the surroundings where the service experience is going to take place?

e. Remember to distinguish between what the bank sees as the process and the real consumer decision making process

THE PEOPLE DECISIONS

Some Questions to Ask When AnalysingPeople Strategies.a. What People (management and staff) training should be effected prior to service experience?

b. What customer service skills need to be in place to handle proper order fulfillment and increase the value of the experience?

c. How should management and staff be trained to overcome and handle difficult customers whilst maintaining the value of the brand they serve?

d. What motivational rewards should be devised by managers to recognise staff efforts?

THE PROMOTION DECISIONS AND THE ROLE OF PROMOTIONAL TOOLS IN THE

PROMOTIONAL MIX

This is the element in the marketing mix used to INFORM, PERSUADE and REMIND the target market about the firms differential advantage eg. Quality, service etc. The unique features help develop a USP (Unique Selling Proposition).In order to reach the target market effectively, the elements in the promotional mix must be COORDINATED themselves as well as being coordinated with other elements in the Marketing Mix. This creates an INTEGRATED MARKETING COMMUNICATIONS campaign. Promotional Mix is often managed by outside experts

CREATING A PROMOTION PLAN

Choose Promotion Mix

Develop Promotion Budget

Set Promotion Objectives

Identify Target Market

Analyse the Marketplace

PROMOTION DECISIONSComponents of the Promotional Mix1. Personal Selling

Involves the presentation of a product to a prospective customer by a representative of the selling organisation across all business. More is spent on personal selling than on any other form of promotion - therefore - desirable to combine with other forms of promotion.

2. Advertising- paid for form of impersonal mass communication - sponsor is clearly identifiable - controlled message - common types - TV, radio, newspapers, mags - non-personal and cannot answer questions - timing.

PROMOTION INTRODUCTIONComponents of Promotional Mix3. Sales Promotion

- Designed to supplement advertising and facilitate personal selling. Can give immediate results eg. trade shows, in store displays, coupons, samples, calendars, gifts, banners, sales aids and leaflets/brochures. Paid for by sponsors and broken down by use: ie. final users, own sales force, other intermediaries (Trade).

I. PROMOTION INTRODUCTION Components of Promotional Mix

4. Public Relations- Planned communication effort to influence

attitudes and opinions of a particular group eg. customers, shareholders via newsletters, annual report, sponsorship of special events.

- Different to Publicity in that publicity is not paid for and has credibility of editorial material, news releases, press conference and photos.

5. Direct Marketing - A two way communication process that requires

an action or response from the customer. - Offers the advantage that it can be

personalised to an individual client and potentially build a relationship.

- Accuracy in Database use can be critical - Results can be measured, especially in direct

mail. Also Call Centres, direct response ads

I. PROMOTION INTRODUCTIONComponents of Promotional Mix6. Sponsorship

- Include Sports, Arts, Communities, General programme and Individuals (Icon or Source Credibility)

- Offers the opportunity of brand building whilst cutting through the clutter

- Size of investment and growth in sponsorship illustrates that it is considered a viable means of achieving marketing and promotional objectives and gives a meaningful return on investment

- Examples are Standard Bank Cricket, National Arts Festival, Arts Gallery and Jazz Festival

I. PROMOTION INTRODUCTIONComponents of Promotional Mix7. Internet and New Media

- This promotional tool represents an extensive and powerful communications network, improving inter and intra-organisational communications. This is achieved via web sites, e-mail, e newsletters, e-zines, BLOGS, auto responders usenet newsgroups, discussion forums etc.

- There is also an opportunity for CRM to be developed utilising Call Centre technologies and therefore get closer to customers.

- New Age media are now playing an complimentary role in communications such as SMS, MMS, Mobile banking.

I. PROMOTION INTRODUCTIONComponents of Promotional Mix8. Event Management

- Is a Strategic Marketing and communications tool. Requires target audience identification, devising the event concept and planning logistics.

- sometimes target audiences by using news media hoping to generate media coverage which could reach millions

- Examples include Product launches, internal communication forums, Corporate Communication functions, Press gatherings etc.

Case Study: ABSA Free Internet

Case Study: Capitec Bank

Distilling the Standard Bank Brand DNA

strategic marketing... · m3 m" m* m/ # ( % ! 9 , $8 1 m m m m m3 m3 % !& 9 , $8 1 m3 m m5...

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