Managing Marketing Processes_Seminar 4

Seminar 4

Managing Marketing Processes----Identifying Market Segments and Targets: Exploring Segmentation, Targeting, and Positioning

Robin TeiglandMaster of General ManagementStockholm School of Economics

September 10, 2013

Seminar 4 Overview

Marketing Plan Group Assignment

Aqualisa Quartz Case

STP

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Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall

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What is a Marketing Plan?

A marketing plan is the central instrument for

directing and coordinating the marketing effort.

It operates at a strategic and tactical level.

McDonald, M. (2006) Strategic Marketing Planning: Theory and Practice, The Marketing Review, 6, 375-

418.

A marketing plan ≠ A business plan

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Wide overview of business, eg

mission, goals, strategy, staff,

operations, location,

marketing, financial

Often used as financial tool to see if business

viable

Business Plan

Marketing Plan

Details actions to fulfill mission and goals. Identifies

business price points, target markets, and

competition and explains how business generates customers

http://smallbusiness.chron.com/difference-between-marketing-business-plan-1682.html

But they are interdependent

!


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Levels of a Marketing Plan

Strategic Target marketing

decisions Value proposition Analysis of

marketing opportunities

Tactical Product features Promotion Merchandising Pricing Sales channels Service

Marketing Plan Contents


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Executive Summary Table of Contents Situation Analysis Marketing Opportunity Assessment Marketing Strategy Financial and Marketing Goals and Budgets Implementation and Controls References

Marketing Plan Group Assignment Assume role of a “marketing manager” and

select an existing Swedish company within a specified industry

Develop a marketing plan for a product or service not currently offered by your company to be launched on the Swedish market Completely new-to-the-world or can be new just to

your company. Write a comprehensive marketing plan

profiling the competitive strategy to bring that product or service to the Swedish market.

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75–80%75–80% of new products being launched fail. Common reasons are:

The idea is good, but the market share is The idea is good, but the market share is overratedoverrated..

The product itself is not developed enough.

The new product is badly positioned on the market, not well-known enough, is priced too high or has the ”wrong” packaging.

The management wants to see their favourite ideas become products against all market research.

Developing costs are higher than anticipated.

Competitors put up more of a fight than anticipated.

GfK 2012

Marketing Plan Teams

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MGM MARKETING - MARKETING PLAN

FALL 2013

GROUPS PREFERENCES COMPANY

DRAGON B2C (Fortune 500) Product H&M

OPERATION BRAHMA B2B SME (<250) Product VETROLIFE

ORANGE B2C SME (<250) Product ASSESSIO

PEAK PERFORMANCE B2B SME Service TENANT & PARTNER

THE MOJITOS B2C (Fortune 500) Service SPOTIFY

THE TRANSFORMERS B2C SME Services LINAS MATKASSE

Presentations

September 13, 9:15-12:00 Initial Presentation Max 10 minute presentation by each Team 5 minutes for discussion by Feedback Team Upload Feedback1_Team#.doc to Courseweb and

email to respective team by September 13, 17:00 September 26, 9:15-13:00 Final Presentation

Max 10 minute presentation by each Team 5 minutes for discussion by Feedback Team Upload Feedback2_Team#.doc (3 page max Word

doc) to Courseweb and email to your respective team by September 27, 17:00

Passport Gmid

Euromonitor International Global Market Information Database

Market statistics on industries, countries and consumers (8 million +) Market reports, company reports and country reports (18 000 +)

Excellent resource!!

Final Report – October 4, 17:00 15 pages Plan + 3 pages Accounting Appendix in MS Word Doc

Not including title page, executive summary, table of contents, references or other appendices

Single-spaced, 12 Times Roman, numbered pages, 2.54 margins All sources documented in proper manner

See www.plagiarism.org for more information on how to cite and document sources.

The marketing plan is evaluated according to three criteria: Professional Written and Oral Communications Critical Thinking Involving Analysis and Understanding of Theoretical

Concepts and Frameworks that Build Your Argument Creative and Original Content yet Feasible Plan

Integration with Using Accounting Reports Separate 3 page Appendix evaluating financial consequences of proposed

marketing plan: detailed month-to-month analysis of impact on company’s financial statements and quantitative evaluations of the proposed investment using capital budgeting techniques covered in “Using Accounting Reports”.

Each group member contributes to the assignment in fair proportion 12

Independent Research – Get Started Now

Start researching Use library’s databases and library staff Determine what data you need to collect and how

Databases, Qualtrics, focus groups, interviews, etc. Contact any relevant people

Follow related topics on twitter: marketing, industry product, etc.

Blog, tweet, post, etc. about what you find #SSEMGM2013

Share with one another!

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Swedish Company and Industry Info

International: Orbis and Factiva Swedish specific (In Swedish): Retriever and

Affärsdata Under Company Databases in library Company information, e.g., annual reports for past

10 years Similar in number of companies in database Retriever is more user friendly than Affärsdata

Own sector classification vs SIC for Affärsdata Can filter search better Creates reports in PDF or Excel

Both have extensive news/article database Affärsdata has better coverage, e.g., Veckans Affärer Retriever has Svenska Dagbladet och Dagens Industri 14

Friday Assignment – Marketing Plan

What do you think the marketing plan needs to accomplish in order to lead the company closer to its strategic goals?

Develop an initial idea for a product/service that you would like to launch for this company on the Swedish market. Motivate your choice of this product.

What do you need to do to develop an understanding of the markets and potential customers of your product? What market research do you need to conduct? What steps will you take to do this?

What are your initial ideas for STP for this product? What are your next steps in order to plan the direction,

objectives, and marketing support for the marketing plan?

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Seminar 4 Overview



STP

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Aqualisa What is the Quartz value proposition to plumbers? To

consumers? Why is the Quartz shower not selling? Aqualisa spent three years and €5.8 million

developing the Quartz. Was the product worth the investment? Is Quartz a niche product or a mainstream product?

What should Harry Rawlinson do to generate sales momentum for the Quartz product? Should he change his marketing strategy to target consumers directly, target the DIY market, or target developers? Should he lower the price of the Quartz? Or should he do something different altogether?

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Seminar 4 Overview



STP

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http://en.wikipedia.org/wiki/Henry_Ford

Ford’s Model T: Mass Market Approach

Any customer can have a car painted any color that he wants so long as it is black.

-Ford in his autobiography

CHP: 8&10-21

Segmentation, Targeting, and Positioning

Market Segmentation1. Identify bases for segmenting market2. Develop segment profiles

Market Segmentation1. Identify bases for segmenting market2. Develop segment profiles Market Targeting

3. Develop measure of segment attractiveness4. Select target segments

Market Targeting3. Develop measure of segment attractiveness4. Select target segments

Market Positioning5. Develop positioning for target segments6. Develop marketing mix for each segment



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What is a Market Segment?

A market segment consists of a group of customers who share a similar set of needs and wants.


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Approaches to Segmenting Consumer Markets

Geographic

Demographic

Psychographic

Behavioral

1. Descriptive: Start with consumer

and then look at needs

2. Behavior & Attitudes:Start with product and

then look at descriptives

Geographic Segmentation


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Demographic Segmentation

Age and family size, lifecycle Gender Income Occupation Education Religion Race Generation Social class Nationality, race and culture

Age and Lifecycle Stage


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Gender and Income


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Generational Influences


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Nationality, Race and Culture


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Psychographic Segmentation: the VALS (Values, Attitudes, Lifestyles) Framework


7-30 http://en.wikipedia.org/wiki/VALS

Divide into different groups based on psychological/personality traits•Lifestyle

• E.g., culture, sports, outdoor•Personality

• E.g., compulsive, authoritarian


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Approaches to Segmenting Consumer Markets

Geographic

Demographic

Psychographic

Behavioral

1. Descriptive: Start with consumer

and then look at needs

2. Behavior & Attitudes:Start with product and

then look at descriptives

Rising Interest in Ethnography

“Ethnography or observational research has drawn significant attention recently,

not only in the market research and marketing fields but in the mass media as well …all starts by doing something simple – keenly watching consumers, fact to face, knee to knee and listening, with ears, eyes, heart, brain and your intuitive sixth sense.”

Procter & Gamble

ex-CEO A.G. LafleyTesco: http://www.youtube.com/watch?

v=fGaVFRzTTP4

CHP: 8&10-33

Behavioral Segmentation

Decision Roles Initiator Influencer Decider Buyer User

Behavioral Variables Occasions Benefits User Status Usage Rate Buyer-readiness Loyalty Status Attitude

CHP: 8&10-34

Behavioral Segmentation Breakdown

GFE Associates: Analysis of Attitudinal Clusters in U.S. Television Households

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CHP: 8&10-36

Segmenting for Business Markets

Demographic segmentation– Industry, company size, location

Operating variables– Technology, usage status, customer

capabilitiesPurchasing approaches

– Purchasing-function, power structure, nature of existing relationships, general purchase policies, purchasing criteria

Situational factors– Urgency, specific application, size of order

Personal characteristics– Buyer-seller similarity, attitudes toward risk,

loyalty

CHP: 8&10-37

Size, purchasing power, profiles of segments can be measured. Segments can be effectively

reached and served.

Segments are large or profitable enough to serve.

Measurable Measurable

Accessible Accessible

Substantial Substantial

Differential Differential

Actionable Actionable

Segments must respond differently to different marketing mix elements & programs.

Effective programs can be designed to attract and serve the segments.

Effective Segmentation Criteria

CHP: 8&10-38








CHP: 8&10-39

Market TargetingEvaluating Market Segments Segment Size and Growth

Analyze current sales, growth rates and expected profitability for various segments.

Segment Structural Attractiveness Consider effects of competitors, availability

of substitute products and, the power of buyers & suppliers (five forces).

Company Objectives and Resources Company skills & resources needed to

succeed in that segment(s). Look for Competitive Advantages.

CHP: 8&10-40

Segment 1Segment 1

Segment 2Segment 2

Segment 3Segment 3

Segment 1Segment 1

Segment 2Segment 2

Segment 3Segment 3

CompanyMarketing

Mix

CompanyMarketing

Mix

CompanyMarketing

Mix

CompanyMarketing

Mix

CompanyMarketing Mix 1






MarketMarket

A. Undifferentiated Marketing

B. Differentiated Marketing

C. Concentrated Marketing

Market TargetingMarket Coverage Strategies

Targeting Strategies

41http://www.globalspec.com/reference/47105/203279/undifferentiated-concentrated-and-differentiated-targeting-strategies

CHP: 8&10-42

Patterns of Target Market Selection

CHP: 8&10-43








Diffusion of Innovation - Rogers

44http://en.wikipedia.org/wiki/File:DiffusionOfInnovation.png

Crossing the Chasm - Moore

45http://www.10xfactor.com/Bookstore_Ten_Best_Book5.html

Seminar 4 Overview



STP

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Managing Marketing Processes_Seminar 4

Business

Transcript of Managing Marketing Processes_Seminar 4