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Nyserda Week 2 06 Aug2009

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  • Point: people differ in attitudes on “green” technologies
  • Proud Traditionalists..
  • Eco-CentricMaybe Green Naives
  • “Customers want products that are more efficient, that last longer and perform better," said Mike Duke, Wal-Mart’s president and CEO. “And increasingly, they want information about the entire lifecycle of a product so they can feel good about buying it. They want to know that the materials in the product are safe, that it was made well and that it was produced in a responsible way.”http://www.brandweek.com/bw/content_display/news-and-features/green-marketing/e3ibdf529f18374f6c998971ae6b7c53fb6
  • Print out. They plan to create a database of information on all suppliers. Can NYSERDA use a similar method and maintain a similar database?
  • Transcript

    • 1. Marketing
      Class #2
      August 6, 2009
      John W. Huppertz, Ph.D.
      Associate Professor of Management
      Christie M. Griner, MBA
      Adjunct Instructor
    • 2. Today’s Agenda
      Fill out 1-page survey
      Quick review from last class
      Where to, for Marketing?
      Market data and analysis
      Break
      Segmentation
      Green marketing and social marketing
      Framing
    • 3. Some key concepts from Week 1:
      Definition of Marketing, the Marketing Concept
      Difference between marketing and selling, advertising
      Different types of markets (consumer, business, government, etc.)
      The four “P’s”
      Disintermediation
      Push and Pull marketing strategies
    • 4. Strategic Business Planning and Decision Making
      How marketing links to strategic business planning
      Translating business goals to marketing strategy
      From---To: Where are we now in terms of a marketing approach and where do we want to be in terms of marketing at NYSERDA
    • 5. Translating business goals to marketing strategy
      NYSERDA ‘s business goals are intertwined with marketing.
      How to get customers to change behavior?
      How to get customers to care?
      How to make sure that energy considerations get factored into their decisions?
      Choosing the right markets, the right products, the right messages.
      That is what marketing strategy is all about.
    • 6. Strategic Business Planning and Decision Making
      From---To: Where are we now in terms of a marketing approach and where do we want to be in terms of marketing at NYSERDA
      Where do we go now?
    • 7. QuizQuestion 1.
      Your friend comes to you, all excited about a great idea for a business, and she wants you to invest some money to help start it.
      If you were considering investing in her new business venture, what should you know before writing a check?
    • 8. QuizQuestion 2.
      You’re the Director of NYSERDA. The leader of the group in charge of new energy technologies comes to you, all excited about a great idea for a NYSERDA program, and wants your support and additional funding.
      If you were considering investing in this new idea, what should you know before writing a check?
    • 9. Category Development Index (CDI) CalculationExample: Foot-Joy Golf Shoes
      Market Penetration =
      Annual Golf Rounds / Population (1,000’s)
    • 10. Category Development Index (CDI) CalculationExample: Foot-Joy Golf Shoes
      Market Penetration
      Average
      x 100
      CDI =
    • 11. CDI Summary
    • 12. Let’s apply this tool to energy.
    • 13. Census data: Consumers
      http://factfinder.census.gov/servlet/DatasetMainPageServlet?_program=DEC&_submenuId=&_lang=en&_ts=
      http://factfinder.census.gov/servlet/DTSubjectKeywordServlet?_ts=267529505781
    • 14. Census data: Businesses
      http://factfinder.census.gov/servlet/IBQTable?_bm=y&-ds_name=BE0200I101&-_lang=en
    • 15. Target Market
      Having a customer in mind when designing a product, advertising campaign, channel strategy, or price level.
      Which customer offers the greatest opportunity?
    • 16. Defining the Target Market
      How would you define the target market for:
      Solar water heating?
      Geothermal wells?
      Energy audits?
      NYPA Power?
      Compact fluorescent bulbs?
      Co-generation?
    • 17. Target Market Segmentation
      Source: Childbirth Connection, survey of 1,600 new moms.
    • 18. Market Segmentation
      In the Target Market Not In the Target Market
    • 19. Market Segmentation
      *
      * Ages 14+
    • 20. Market Segmentation
      Or, 280 million segments with
      N = 1
    • 21. Market Segmentation
      *
      * Ages 14+
    • 22. Market Segmentation
      *
      * Ages 14+
    • 23. Market Segmentation
      *
      * Ages 14+
    • 24. Market Segmentation
    • 25. Market Segmentation: Age
    • 26. Who Wants to Be a Millennial?
      Source: Harris Interactive YouthPulse/The Harris Poll
    • 27. Market Segmentation
      You can create segments on almost any characteristic.
      Demographics
      Lifestyle
      Buying habits
      Behaviors
      Health status
      Benefits
      ??
      Find those which are relevant.
    • 28. Market Segmentation
    • 29. Benefit Segmentation
      Segment customers based on the benefits they seek from a particular product.
      Group customers based on their needs.
      EX: non-prescription pain relievers and exercise.
    • 30. If you have aches and pains, do you prefer:
    • 31.
    • 32. 5
      4
      3
      2
      1
      5
      4
      3
      2
      1
      4
      3
      2
      1
      5
      3
      2
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      5
      4
      2
      5
      4
      3
      1
    • 33. Segmentation by Attitude
    • 34. Segmentation by Attitude
      5-10  Couch potatoes
      11-19  Casual exercisers
      20-25  Exercise nuts
    • 35. If you have aches and pains, do you prefer:
    • 36. If you have aches and pains, do you prefer:
    • 37. Green Marketing: Best Practices
    • 38. Shades of Green
    • 39. Green Segmentation
      Points of interest
      • Respectful Stewards: 86% Hispanic
      • 40. Eco-Villans are mostly middle income white males
      • 41. Green Naivesmostly female
      • 42. Most Gen X’s are lighter green, reason?
    • Why market to Millennial’s?
      Born early 80’s-late 90’s
      Market Segmentation is critical
      Two segments-13-17; 18-29
      Most educated demographic
      79% get info from web
      Problem: Understand why but not how
      Must quantify not simply preach-give them instant gratification
      If families recycle newspaper for 1 year saves half million trees
      Cut shower time down by 2 minutes saves 10 gallons of water
      Put a sweater on when cold, turn thermostat down save 500,000 barrels of oil/day
      Marketing technique Align marketing with corporate responsibility
      Creates loyalty
    • 43. Commercial Case Study: Wal-Mart
      Does WMT market “green” to each segment? How?
    • 44. Who is this targeting?
    • 45. ..and this?
    • 46. How is WMT reaching their audience?
    • 47. Wal-Mart’s LT Goals
      To be supplied by 100% by renewable energy
      To create zero waste
      To sell products that sustain resources and environment
      Are they attainable?
    • 48. The Power of Wal-Mart
      Choose Suppliers
      Wal-Mart will list criteria and suppliers must adhere to be part of the supplier list
      Requests full-disclosure on products via supplier
      Will it be worth it long-term for suppliers to alter their practices for one retailer?
    • 49. Supplier Survey
    • 50. Sustainability 360
      • Alternative Energy to Power Facilities
      • 51. Purchased Solar Power (22 CA&HI stores)
      • 52. Wind energy supplies 15% of power to run TX stores
      • 53. Energy-Efficient Transportation Fleets
      • 54. Wants to improve by 25%
      • 55. Overnight trucks have APUs to regulate temperature and communication
      • 56. Testing hybrid trucks and alternative fueled trucks
      • 57. Sustainable Packaging Network
      • 58. Reduce packaging by 5% by 2013
      • 59. Laundry liquid, private labels, digital media packaging
      • 60. Plastic Bags
      • 61. Reduce by 33% by 2013
      • 62. High-Efficiency Store Formats
    • High-Efficiency Store Format
      HE.6- Western US-Sacramento, CA
      Post HE.5 (Vegas)
      30% more energy efficient than the 2005 baseline –added evaporative cooling and radiant flooring
      • Goal: Conserve energy, and reduce greenhouse gas emissions through heating, cooling, refrigeration and lighting systems.
      Cooling Towers reduces temperature
      CO2 refrigerant system reduces the refrigerant charge in the store by 90%
    • 63. Why does HE.6 matter?
      Market Pioneers
      Skylights
      LED lighting
      Recycled cement
      Low flow toilets/faucets
      Improved customer experience
      Wider isles
      Lower shelves
      Improved sightlines
      Service area
    • 64. NYSERDA implementation
      How can you get a local retailer to implement a high-efficiency store format?
    • 65. What goals has WMT achieved?
      Sold 100M compact fluorescent light bulbs in 2007
      Effect: does away with the need for 100 million old-fashioned bulbs to be manufactured, packaged, shipped, bought, and discarded next year--and every year until 2012 or beyond
      Most of WMT’s goals slated out 4-5yrs
    • 66. Do these companies “feel” green to you? Why?
    • 67. Industrial Case Study: HP
      In general, HP..
      Owns “e-waste” recycling plants that shred discarded, obsolete computer products into raw materials that are reused in the industrial food chain
      Takes back computer equipment of all brands
      All HP products are 100% recyclable
      Promises to lower energy consumption 20% by next year
    • 68. HP Campaign: Power to Change
    • 69. “Power to Change”
      HP Philosophy: industry leadership is about an ongoing contribution to society
      Launched 6/09 by Leo Burnett
      Modern, stylish, innovative, colorful, results-driven
      Gives consumer autonomy and purpose
      Taps into behavioral changes
      Quantitative
      Tracks cumulative energy savings if turning off idle PCs when not in use
      Method
      Widget
      Commitment: must enroll & install
      Gathers demographic information
      Enables campaign success metrics
    • 70. Campaign Motives
      Small commitment yields large impact
      If 100,000 users shut down work computers each day, energy savings could total more than 2,680 kilowatts
      Reduce carbon emissions by 1,500 kilos/day
      equivalent to removing 105 cars from the road/day
    • 71. HP Recycling Campaign
    • 72. Education at POS via Labeling
      Energy Star labeling impacts Green Purchases 66%
    • 73. Ex: HP Labeling
      Greater Variety + Eco-labeling = Increased sales + Customer Loyalty
    • 74. Recession
      • Primary motivation
      • 75. Save money in difficult times
      • 76. Consistent trends
      • 77. Recycled paper
      • 78. Green household cleaning products
      • 79. Environmental safe laundry detergent
      • 80. This links to where people see the need but not know how to implement it
      • 81. Cloth grocery bags
      • 82. Unplugging unused chargers
    • Geodemographic Segmentation
      PRIZM (Claritas, Inc.)
      Cluster-analysis based
      Residential neighborhoods
      “Birds of a feather flock together.”
    • 83.
    • 84.
    • 85. Cohort Segmentation
      Simple age combination / aggregation into generational segments
      Message tailoring
      Example of simplistic segmentation (Yankelovich and Meer, 2006)
    • 86. Cohort Segmentation
    • 87. Cohort Segmentation
      What can you do with this?
    • 88. Segmenting Business Markets
      Note: SIC  NAICS
    • 89.
    • 90.
    • 91. Segmentation Conclusion:Three Reasons to Segment the Market
      Better understand the customer
      Develop new products to meet needs of similar users.
      Create features that most segment members want.
      Message development: figure out what to say, so that they “get it” even if others don’t.
      Reach customers more efficiently
      Get message to your customer with out wasting money on reaching others.
      Locate where your customers are.
      Select the best target market
      • Select customers with highest potential.
      • 92. Profitability (ability to buy)
      • 93. Loyalty – for long-term profitable relationship
    • Web 2.0 is changing the dynamic
      Better understand the customer
      Develop new products to meet needs of similar users.
      Create features that most segment members want.
      Message development: figure out what to say, so that they “get it” even if others don’t.
      Reach customers more efficiently
      Get message to your customer with out wasting money on reaching others.
      Locate where your customers are.
      Select the best target market
      • Select customers with highest potential.
      • 94. Profitability (ability to buy)
      • 95. Loyalty – for long-term profitable relationship
    • Things are changing
      In politics:
      50% plus one.
      Red states, Blue states
      In marketing research:
      Survey research
      Sales analysis
      Consumer testing, R&D cycle
      In marketing plans:
      Charge premium “Price”
      More “Promotion”
      In customer selection:
      It’s easier to sell $10,000 to one customer than to sell $1 to 10,000 customers.
      Some customers just aren't worth chasing.
    • 96. Things are changing
      In politics:
      50% plus one.
      Red states, Blue states
      In marketing research:
      Survey research
      Sales analysis
      Consumer testing, R&D cycle
      In marketing plans:
      Promotion to everyone
      In customer selection:
      It’s easier to sell $10,000 to one customer than to sell $1 to 10,000 customers.
      Some customers just aren't worth chasing.
      In politics:
      • Everyone counts.
      • 97. United States
      In marketing research:
      • Qualitative observation
      • 98. Analytics
      • 99. Quick prototyping
      In marketing plans:
      • Promotion to those ready to respond
      In customer selection:
      • It’s becoming easier to sell $1 to 10,000 customers. (Think i-tunes).
      • 100. More customers than you think are worth chasing.
    • Segmentation Conclusion:Three Reasons to Segment the Market
      Better understand the customer
      Develop new products to meet needs of similar users.
      Create features that most segment members want.
      Message development: figure out what to say, so that they “get it” even if others don’t.
      Reach customers more efficiently
      Get message to your customer with out wasting money on reaching others.
      Locate where your customers are.
      Select the best target market
      • Select customers with highest potential.
      • 101. Profitability (ability to buy)
      • 102. Loyalty – for long-term profitable relationship
    • Framing
      In politics:
      Senator Moyer missed 14 critical opportunities to vote on matters of importance to her constituents.
      Senator Moyer had a “99% perfect voting attendance record.
      See: Tversky, A., and Kahneman, D. (1981). The framing of decisions and the psychology of choice. Science, 211, 453-458.
    • 103. Framing
      In retail promotion:
      Hurry in and save $20.
      Hurry in and save 20%.
    • 104. Framing
      In energy:
      Lower your energy use and save the environment.
      If you don’t lower your energy use, you won’t have an environment to save.
    • 105. Framing
      In energy:
      Lower your heating bill by 30% and save the environment.
      Lower your heating bill by 30% and enjoy a vacation with the money you save.
    • 106. Framing
      In class strategy session:
      Three teams, five minutes
      Come up with two alternativesways of framing the following:
      “You should buy compact fluorescent bulbs instead of incandescent bulbs because _________________________.”
    • 107. Assignment, due next class
      Marketing “best practices”
      Teams:
      Marketing Services
      EES, EA, Clean Energy, REAP
      Economic Development
      New Technologies
       10 pages, 10 minutes.
    • 108. Summary
      What did we learn today?
      Some key take-aways?
      Some things you won’t forget?

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