THE MARKETING STRATEGY

1. THE MARKETING STRATEGY 9.1 Developing a Market Strategy 9.2 Assessing Marketing Mix Alternatives 9.3 Analyzing Product Purchase Classifications 9.4 Planning for Marketing 9.5 Developing a Marketing Plan © South-Western Publishing

2. DEVELOPING A MARKET STRATEGY GOALS for Lesson 9.1 • Describe how market segments are defined. • Understand the four criteria that an effective target market must meet. © South-Western Publishing

3. Differentiating Market Segments • Marketing strategy • Significant differences • Common characteristics © South-Western Publishing

4. Differentiating Market Segments • Marketing Strategy – the way marketing activities are planned and coordinated to achieve an organizations goal. • marketing concept develops marketing strategies to satisfy customer needs • identify target market – develop a marketing mix © South-Western Publishing

5. Differentiating Market Segments • Significant Differences • difference between consumers in a market • example – products for graduating seniors © South-Western Publishing

6. Differentiating Market Segments • Common Characteristics • segments – components of a market in which people have one or more similar characteristics • most important are wants and needs • demographic characteristics • buying behaviors © South-Western Publishing

7. Selecting Target Markets A target market is a clearly identified segment of the market to which the company wants to appeal. © South-Western Publishing

8. Selecting Target Markets • The people in the target market must have common important needs and respond in a similar way to marketing activities designed to satisfy those needs. • The people outside of the target market should have enough differences from those in the market that they will not find the marketing activities satisfying. © South-Western Publishing

9. Selecting Target Markets • There should be adequate information about the people in the target market so they can be identified and located. • There should be enough information about the consumers’ needs and how they make purchasing decisions that an effective marketing mix can be developed. © South-Western Publishing

10. In Groups • Successful companies have many or at least several marketing segments. Name four local companies and identify three marketing segments for each business. • Example – Encinitas Malt Shop • Senior Citizens • Youth athletic teams • Families © South-Western Publishing

11. ASSESSING MARKETING MIX ALTERNATIVES GOALS for Lesson 9.2 • Describe aspects of a basic product that can be altered to improve its market appeal. • Discuss the considerations that marketers take into account when planning distribution, pricing, and promotions. • Define four stages of a product life cycle. © South-Western Publishing

12. Basic product – movies, child care Product features – car, telephone Options – phone services Associated services – service contract Brand name/image – memorable quality Guarantee/warranty Packaging Uses – other uses Fine-Tuning the Product © South-Western Publishing

13. Distribution, Price, and Promotion • Distribution is the marketing mix element that facilitates the physical exchange of products and services between businesses and their customers • Price as a marketing mix element is defined as the amount a buyer pays as well as the methods of increasing the value of the product to the customers. • Promotion includes the methods and information communicated to customers to encourage purchases and increase their satisfaction. © South-Western Publishing

14. Distribution • Where will the customer be best able to obtain the product? • Where will the customer use the product? • Are there special requirements to transport, store or display the product? • When should distribution occur? • Who should be responsible for each type of distribution activity? © South-Western Publishing

15. Price • Does the business want to increase sales, increase profits, or enhance image of the product? • Should price be based on cost, what customers are willing to pay, or what competitors are charging? • Will there be one price for all customers, negotiation, discounts? • Will the price be clearly communicated? • Are there things that clearly satisfy the customer and make the product better and more valuable than alternatives? © South-Western Publishing

16. Promotion • Will the audience for the promotion be a general market or specific segment? • Is the specific goal of promotion to increase knowledge, to change attitudes, or influence behavior? • What specific information does the audience need? • What means of promotion will be most effective? • How much money is needed for effective marketing? • What information does the business need from consumers? © South-Western Publishing

17. Using Life Cycle Analysis Three factors to consider when planning a marketing mix: • the type of competition • the purchase behavior of consumers • the strengths and weaknesses of the business © South-Western Publishing

18. Stages of a Product Life Cycle • Introduction • Growth • Maturity • Decline © South-Western Publishing

19. Introduction • competing against older, established products • businesses need to identify those that are dissatisfied with the current problems • product should be basic and not too complicated • guarantee and warranties • not widely distributed • price usually high • promotion needs to inform the customer © South-Western Publishing

20. Growth • if product successful, competitors will enter the market • features and options must be added • wider distribution • adjustment in pricing • promotion must attract customers, advantages of the product © South-Western Publishing

21. Maturity • sales peak, profit begin to decline, customers have the product and there are many companies in the market, competition becomes very intense • all products features, option, guarantees/warranties are similar (so customer service options could be added) • pricing become very competitive • increase availability of the product becomes wider • promotion – why their product is better © South-Western Publishing

22. Decline • product is no longer satisfying or they discover new and better products, sales drop, little or no profit • try to identify other uses • distribution is reduce • price is usually reduced • more selective and less promotions © South-Western Publishing

23. SALES PROFITS Introduction Growth Maturity Decline Stages in a Life Cycle © South-Western Publishing

24. Homework – due tomorrow • Choose 3 product that you use frequently and analyze it against each marketing mix element represented in Figure 9-3 on page 225. © South-Western Publishing

25. ANALYZING PRODUCT PURCHASE CLASSIFICATIONS GOALS for Lesson 9.3 • Describe the four product/service purchase classifications. • Explain how product/service purchase classifications affect marketing planning. © South-Western Publishing

26. Purchase Classification System Product/service purchase classification system (a description of the way consumers shop for products based on their needs and perception of products) is based on two factors: • Importance of the purchase to the consumer • Willingness of the consumer to shop and compare products before making the purchase © South-Western Publishing

27. Convenience Goods Staple goods – bread, milk, snacks Impulse goods – unplanned purchases Emergency goods – repairs, medical services Shopping Goods Attribute-based goods Price-based goods Specialty Goods – brand loyalty, well known, delay purchase Unsought Goods – life insurance, preparing a will Classifying Products for the Consumer Market © South-Western Publishing

28. Applying Purchase Classifications to Marketing Planning • Convenience goods - the product mix element should focus on brand, packaging, and image • Shopping goods - promotion is highly important, emphasizes the quality of the product or service • Specialty goods - planning should insure that the quality and uniqueness is maintained, location and price are also important • Unsought goods - new product should focus on promotion and distribution; promotion must stress the importance or need of the product or service © South-Western Publishing

29. PLANNING FOR MARKETING GOALS for Lesson 9.4 • Understand the benefits of marketing planning. • Describe the steps of developing a marketing plan. © South-Western Publishing

30. The Benefits of Planning • What is a marketing plan? A clear written description of the marketing strategies of a business and the way the business will operate to accomplish each strategy. • From strategy to plan – target markets / marketing mix helps with the development of the marketing plan © South-Western Publishing

31. The Advantage of Planning • Being able to align the following elements (areas of focus): • Customer service • Advertising • Sales • Distribution © South-Western Publishing

32. Preparing For Marketing Planning • Planning to plan – time and people • Plans are built with information • Performance of the company • Performance of competing companies • Changes outside the company – economy, laws, taxes • Information about current and prospective customers • Gathering needed information - MkIS © South-Western Publishing

33. In Groups Referring to the four areas of focus while planning (customer service, advertising, sales and distribution), decide how those four areas should be addressed and why the are important to a marketing plan. You should pick one specific product to focus on. © South-Western Publishing

34. DEVELOPING A MARKETING PLAN GOALS for Lesson 9.5 • Identify the five types of market analysis used in developing a marketing plan. • Describe the elements of an effective marketing plan. • Explain the need for activity schedules and evaluation procedures. © South-Western Publishing

35. Analyzing the Market • Purpose and mission – identifies the nature of the business or the reasons the business exists • What is the reason this business exists? • Who is the business most interested in serving? • What is the business trying to accomplish? © South-Western Publishing

36. Analyzing the Market • Current markets and strategies – a review of the current marketing efforts of the company • Who are the current customers? • What are the needs and wants of the customers? • How would customers describe the characteristics of the product, distribution, price, promotion? © South-Western Publishing

37. Analyzing the Market • Primary competitors – an analysis of the competitors in the same product categories with similar customers • What other businesses do customers consider? • What things do other businesses do that entice customers? • What are the customers dislikes of the other businesses? © South-Western Publishing

38. Analyzing the Market • External environment analysis – identifying factors outside of the company • How is the economy doing, predictions? • Are there any laws that could affect business operations? • Are there any possible cost increases? • Where is the product in the life cycle? • Are there any technology changes in the future? © South-Western Publishing

39. Analyzing the Market • Internal analysis – current strengths and weaknesses of the company • What makes the businesses operations, and its marketing mix different and better? • What things are competitors doing better? • What plans are underway that might result in changes? © South-Western Publishing

40. Deciding on Strategy • Determining goals and outcomes – a specific statement of the goals the company plans to achieve or the expected outcomes • What are the important results? • What will be used to determine if the marketing activities are successful? © South-Western Publishing

41. Deciding on Strategy • Defining target markets – the markets most be defined completely • Will the market be the same or different from the last plan? • What are the characteristic, is the market unique? • Who is the market purchasing from? • What are the needs and attitudes towards the product? • How do they purchase the product? © South-Western Publishing

42. Deciding on Strategy • Specifying the market mix – a description of each marketing mix element • What are the alternatives for each element? • What are the specific and important elements of each that the market will prefer? • What meets the markets needs and can it be implemented effectively? • Who needs to be involved within the company and outside the company? © South-Western Publishing

43. Deciding on Strategy • Developing a positioning statement – a specific description of the unique qualities of the marketing mix that make it different from the competition and satisfying to the target market • What is unique about the market? • What are the unique qualities of the marketing mix? • How can they be communicated to the market? © South-Western Publishing

44. Planning for Action • Activity schedule – a schedule of activities that need to be completed, along with a description of how and when the activities will be completed • Evaluation procedures – was the plan effective, where the activities completed on time and the right way, were the objectives accomplished © South-Western Publishing