Principles of Marketing - Burapha - Chapter 8 - Managing MVP

7/31/2019 Principles of Marketing - Burapha - Chapter 8 - Managing MVP

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Burapha University

Market

ing

s of


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Principles of MarketingBurapha University

International College

953381


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Positioning

Achieving Positioning.


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Positioning


In marketing, a customer value proposition (CVP)

consists of the sum total of benefits whicha vendor promises a customer will receive inreturn for the customer's associated payment (orother value-transfer).

Investopedia. (2010). Value Proposition. Retrieved 4 22, 2010, from

Investopedia: http://www.investopedia.com/terms/v/valueproposition.asp
http://www.bbmarketingplus.com/blog/2008/11/05/capturing-buyers-attention-what-makes-a-value-proposition-compelling/http://www.bbmarketingplus.com/blog/2008/11/05/capturing-buyers-attention-what-makes-a-value-proposition-compelling/


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Positioning


A Marketing value proposition

(MVP) is an offer that describes thequantifiable benefit(s) that theindividual(s) or organization(s)making the offer promise(s) to deliver.

Capturing Buyers' Attention: What makes a value

proposition compelling? On:

http://www.bbmarketingplus.com/blog/2008/11/05/capturing-buyers-attention-what-makes-a-value-proposition-

compelling/
http://www.bbmarketingplus.com/blog/2008/11/05/capturing-buyers-attention-what-makes-a-value-proposition-compelling/


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Positioning

Marketing Value Proposal.

Marketing

Value

Proposal

Image

PriceProduct


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Manage MVP

Marketing

Value

Proposal

Image

PriceProduct

Management

Management

Management


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Image Management

Charles Revlon, Revlon founder


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Image Management

Psychological Expectations

Image


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Image Management

Image answers the targets psychologicalexpectations.

need to be

respected, to have

self-esteem, self-

respect

belonging and acceptance

yearning for a predictable,orderly world in which injustice

and inconsistency are under control

literal requirements for human survivalPhisiological Needs

Safety Needs

Social Needs

Esteem Needs

Self-actualizationPersonal

growth and

fulfillment


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Image Management

Image dimensions

(Awaremess) (Identity)


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Image Management

Image dimensions

Identity

Awareness

HTC

Kate Moss

Porsche


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Image Management

Image vehicles

Brand (trademark),

Symbols,

Style,

Word of mouth,

People Media


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Image Management

Brands & Trade Marks

The Brand name itself means something tocustomers. It is a powerful unconcious vehicle.

Roles:

To identify To differentiate

To guarantee To carry the image

The brand is a valued asset

(goodwill)


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Image Management

Symbols.


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Image management

Symbols.


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1956

Image management

Symbols.


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2003

Image management

Symbols.


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Image management

Symbols.

Roles of symbols: alleviating perceivedrisk and making promise of satisfactionmore tangible


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Image management

Symbols.


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Image management


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Image management


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Image management


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Image Management

Symbols.

View: Lacoste crocodile, Perrier bottle, Coke

bottle

Smell: perfume in washing detergents, newcars

Touch: yoghurt glass jars Taste: mint toothpaste

Hearing: music


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Image Management

Symbols.


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Image Management

Symbols.

http://www.youtube.com/watch?v=6RnDx7T0qgo&feature=related

http://www.youtube.com/watch?v=0B_GY9hkSWs
http://www.youtube.com/watch?v=6RnDx7T0qgo&feature=relatedhttp://www.youtube.com/watch?v=0B_GY9hkSWshttp://www.youtube.com/watch?v=0B_GY9hkSWshttp://www.youtube.com/watch?v=6RnDx7T0qgo&feature=related


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Image Management

Symbols.

John McEnroe
http://www.youtube.com/watch?v=DZgsSLLmXrc&feature=relatedhttp://www.youtube.com/watch?v=DZgsSLLmXrc&feature=relatedhttp://www.youtube.com/watch?v=ekQ_Ja02gTY


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Image Management

Symbols.

Jim Carrey BustaRhymes

MissyEliott

LL Cool J
http://www.youtube.com/watch?v=SpwK3vFGJp0http://www.youtube.com/watch?v=UVYzxxgKXTYhttp://www.youtube.com/watch?v=UVYzxxgKXTYhttp://www.youtube.com/watch?v=DZgsSLLmXrc&feature=relatedhttp://www.youtube.com/watch?v=DZgsSLLmXrc&feature=relatedhttp://www.youtube.com/watch?v=DZgsSLLmXrc&feature=relatedhttp://www.youtube.com/watch?v=UVYzxxgKXTYhttp://www.youtube.com/watch?v=DZgsSLLmXrc&feature=relatedhttp://www.youtube.com/watch?v=SpwK3vFGJp0


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Image Management

Style

The less a product is tangible, the more itsstyle is important :

complicated products

services

Therefore importance of :

packaging

design

shopping environment

company offices


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Image Management

People

In service activities (pure serviceor added service) consumption is

simultaneous to production.

Interactions between front linepersonnel and customers

influence directly customersperception

Thats why Human ResourceManagement

has now become a marketin tool


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Image Management

Media

Earned media (or free media)

refers tofavorable publicity gainedthrough promotional effortsother than advertising, asopposed toPaid media, whichrefers to publicity gainedthrough advertising.


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Image Management

Word of mouth

Is the most powerful Marketing vehicle, but the

most difficult to control!


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Image Management

Asignment

Choose a brand and describe its image.


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Manage MVP

Marketing

Value

Proposal

Image

PriceProduct

Management

Management

Management


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Price Managemet

Price

Is a component of profitability

for the seller

Is a sacrificeagainst a promise

of satisfaction

for the customer


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Price Managemet

Price

Ceiling:

Preceived Value

Floor:

Unit Cost

PRICING


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Price Management

Four Key Factors.


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Price Management

Price as a microeconomicitem

P

Q

Unit Cost

P

Q

Costs

Turnover

Consumerssurplus


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Price Management

P

Q

P1P1

P2

Q1 Q2

Unit Cost

Loss

Gain

1

2

P2

Effects of a Price cut.


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Price Management

Elasticity.

P2

Q2

P1

Q1

P2

Q2

P1

Q1


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Price Management

Elasticity.

Delta P/PE =

Delta Q/Q

Delta Q/Q> Delta P/P

Delta Q/Q< Delta P/P

E > 1

E < 1


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Price Management

Break Even

Q

Fix Costs

Unit Costs

Break Even

Point

P1P1

Q1

C1P2

Q2

P2

C2

P

Q

C= P


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Price Management

2 approaches Skimming

Demand: Inelastic

Production capacity: Limited

Barriers to entry: High

Condition:Perceived Value


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Price Management

2 approaches Penetration

Demand:Elastic

Production capacity:Over capacity

Barriers to entry: Low

Condition:Cost advantage


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Price Management

Discriminatory Pricing

P

Costs

Q

P

P

Q

P

Q

Costs

Q

P

Unit Cost

Q

Unit Cost


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Price Management

Discriminatory Pricing

P

P

Q

Costs

Q

P

Q

P

Q

Costs

Q

P

Unit Cost

Q

Unit Cost


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Price Management

Commonly used policies and disturbing events

Skim the cream vs penetration pricing

Leader vs followers

Cost price + uniform margin (not recommended) Price wars

Temporary undercapacity

Dumping

Government regulations Private and public bids

.


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Price Management


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Product Management

Definition

Inmarketing, a product is anything that can beoffered to a market that might satisfy a want or

needKotler, P., Armstrong, G., Brown, L., and Adam, S.

(2006) Marketing, 7th Ed. Pearson Education Australia/Prentice Hall.

People buy products in order to solve problems

Products are problem solving toolsLevitt, Theodore


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Product Management


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Product Management

POTENTIAL

AUGMENTED

EXPECTED

GENERIC

Generic product :

Just thebasic characteristics

Expected product :Includes customers minimum

expectations. Customers will notbuy as long as these expectations

are not met.

Augmented product :

Everything that the marketer canoffer beyond the customers

expectations

Potential product :Anything that could still be done to

attract new customers or develop

loyalty

LevittsTotal Product.


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Product Management

POTENTIAL

AUGMENTED

EXPECTED

GENERIC


Each ring carries serviceactivities or tangible attributesthe final product is made of:

Packaging Training Installation After sales service Guarantee Use & care instructions


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Product Management



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Product Management


The basic product (generic) isnot the real product.

The total product is theconcrete expression of thepositioning.

Products can be tangible orintangible. Often, they are acombination of both.


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Product Management

Asignment

Chose a product and break it down according to

Levitts Total Product theory.


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Product Management

Product Life Cycle

Time

Sales


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Product Management

Introduction Growth Maturity Decline

Sales Low Increasing Maximum Falling

Price High Decreasing Lowest Increasing

Competition Limited Increasing Maximum falling

Marketing

Objectives

Create market Market share Market share Cash

Products Few Wider range Diversity Shrinking

Profits Negative Increasing Maximum thefalling

Falling

Clients Pioneers Followers Mass Traditional

Distribution Selective Spread out Diversified Selective

Advertizing

Objectives

Primary

demand

Secondary

demand

Differenciation Reduction


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Product Management

Product Life Cycle

Need to answer the following questions :

When to introduce / remove a product ? What means behind what product ?

Which trade offs of means between the products ?

2 major variables : attractiveness and competitiveposition


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Product Management

BCG Product Management Model

Growth

Relative Market Share2 1/2


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Positioning

MVP, Coherence!

Marketing

Value

Proposal

Image

Principles of Marketing - Burapha - Chapter 8 - Managing MVP

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