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AJU BROEKMAN Marketing Seminar Friday 11-21-14

Marketing Seminar Class #3 taught at American Jewish University Undergraduate program.

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AJU BROEKMAN Marketing Seminar Friday 11-21-14

  2. 2. • Seven functions of marketing • Four foundations of marketing • Goods and services / wants and needs • The Four Ps / Marketing Mix • Customer and consumer • Market definitions • SWOT Analysis + Internal and External Analyses. • Market segmentation + Target marketing + Mass marketing • Marketing concept and Selling/Henry Ford approach • Demographics + psychographics + DNA + statistics • Marketing plans + code books • Branding 101 with real client work Marketing Seminar Overview
  3. 3. What is Marketing?
  4. 4. Marketing is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, & society at large. -- American Marketing Association Marketing is the conversation between a company or brand and a consumer that ultimately leads to brand recall, preference or a transaction. In today’s socially networked world, that conversation is being disintermediated by word of mouth referrals. Traditional marketers will have to work harder to get ahead of and to influence this trend. -- Josh Glantz – Vice President and General Manager, PCH Online-Publishers Clearing House (disintermediated = remove the middle man) 72 Definitions of Marketing - Marketing Seminar Overview
  5. 5. Marketing is the art and science of persuading a potential buyer of a product/ service to purchase from a company that’s responsible for creating a compelling message and communicating that message through targeted channels with enough reach and frequency to guide that potential buyer through the purchase cycle of “attention, interest, desire, action.” -- Paul Mosenson President, NuSpark Marketing Marketing is an integrated, multi-channel (online and offline), customer-centric process used to define, segment, reach, and convince potential clients to purchase your product or service, followed by analyzing the metrics to refine your strategy and repeat the process as needed to optimize the ROI (return on investment). -- Sharon Mostyn – Assistant Vice President, 1st Mariner Bankd Marketing Seminar Overview
  6. 6. Seven Functions of Marketing • Distribution Function • Financing Function • Product/Service Management • Marketing Information Management • Pricing Function • Promotion Function • Selling Function
  7. 7. Distribution Function • Deciding where products are to be sold and to whom • Moving and storing goods from/to customer
  8. 8. Financing Function Getting the money necessary to pay for the operation of a business. How the customer will pay for the product. #1 Killer.
  9. 9. Product/Service Management Function • Obtaining, developing, maintaining, and improving a good or a service over time. • Goods and services have a life cycle, and the phase of the life cycle is important in product/service management. • A product is introduced, (hopefully) it is in great demand, it matures and maintains a steady market, and then it declines. • A marketing strategy will depend on what phase of the life cycle in is in. Is it a new product or has it been around for years?
  10. 10. Product Market Life Cycle Introductory Phase Customers: Unfamiliar with or unaware of product category. Those who do buy likely to be more experimentalist by nature. Sales low Competition: Likely to be low Company priorities: Encourage trial. Work with customers on product development to improve aspects such as packaging or documentation, or to eliminate "teething troubles"
  11. 11. Product Market Life Cycle Growth Phase Customers: Growing in numbers. Segments begin to appear. May be less price sensitive as category benefits more widely known Competition: Growing as new entrants appear. Company priorities: Build share by concentrating on distribution, creating alliances where appropriate to do this
  12. 12. Product Market Life Cycle Early Maturity Customers: Segmentation is now more distinct and customer loyalty established as repeat purchases take place Competition: Intense as players attempt to secure their share Company priorities: Differentiate to attract and retain customers in specific target segments
  13. 13. Product Market Life Cycle Late Maturity Customers: Knowledgeable, may demand low prices and high service levels Competition: Intense due to lack of market growth and difficulty of further differentiation. May be price based Company priorities: Attempt to lengthen life cycle by innovation, re-inventing product category before decline stage
  14. 14. Product Market Life Cycle Decline Customers: Late adopters, i.e. first time buyers of DVDs and CDs, catch-up consumers Competition: May come more from substitute products or services than direct competition, eg plastic instead of steel components; on line services instead of libraries or hard copy journals Company priorities: Re-define market whilst milking profits in early part of decline stage.
  15. 15. GAME OVER.
  16. 16. Marketing Information Management • Marketing Research • Links the consumer, customer, and public to the marketer through information • Information used to identify and define marketing opportunities and problems; • Generate, refine, and evaluate marketing actions; • Monitor marketing performance; • Improve understanding of marketing as a process. • Method for collecting information, analyze results, and communicate findings and their implications.
  17. 17. Pricing Function • Essential to success in marketing! Satisfying the customer and making a profit. • While you can put any price you want on a product, as a business you need to determine what price will actually bring the greatest profit. 1. Costs to produce the product 2. Demand of product 3. Availability of similar products (competition) 4. What customers will be willing to pay
  18. 18. Promotional Function • Promotions, Publicity, PR • Persuading customers to buy • Raising awareness • Win-back campaigns from past customers • Retention of current customers • Promotion ranges from multimillion- dollar advertising campaigns to communication between a salesperson and a potential customer. • Promotion = showing corporate socially responsibility
  19. 19. Selling Function Matching customer needs and wants with goods and/or services. • MOST of today’s CEOs began careers: selling. • Selling provides customers with the goods and services they want. • Retail selling • Business-to-business selling • Takes place at all levels of business- manufacturing, wholesale, middle, retail.
  20. 20. Marketing Skills flow from these 4 areas • Business, management, entrepreneurship Understanding the basics of business that can affect business decisions. • Communication and interpersonal skills Understanding how to work efficiently with others. Team Player. • Economics Understanding economic principles that are basic to marketing. Understand $$$$$$ = everything • Professional Development Understanding concepts needed for career exploration, development, and growth.
  21. 21. Two approaches to selling goods/services • The Henry Ford Approach Henry Ford once said, "You can have any color of car you want—as long as it is black." Ford did not follow a customer- oriented approach. • The Marketing Concept Approach A company's main goal is to satisfy the needs and wants of customers while also making a profit. According to this approach, if you keep the customer happy and coming back, the profits will follow.
  22. 22. Needs vs Wants & Income The basic difference between the terms is that needs are things necessary for survival, while wants are things that add comfort and aesthetic pleasures to life. Marketers want to know how much money people have to spend on products. Two types of income measurement. - Disposable income is the money left after taxes are subtracted. - Discretionary income is the money left after basic living expenses have been met.
  23. 23. Added Value and Five Economic Utilities • Five economic utilities and their connections to one another. • Utility refers to add-on value. • The functions of marketing add value to a product. • That is, we take something and combine it with other features to make it more valuable. FORM UTILITY PLACE UTILITY TIME UTILITY POSSESSION UTILITY INFORMATION UTILITY FIVE UTILITIES
  24. 24. Form Utility • Form utility represents the manufacturing of a Better product • Changing materials • Putting parts together faster • Making products more useful • Not directly related to marketing
  25. 25. Place Utility • Place utility – Placing product who need it can buy it and NEED it. • Having a product where customers can buy it. • Most convenient • Most efficient • Catalogs, retails stores, internet
  26. 26. Time Utility • Having a product available at a certain time of year or a convenient time of day.
  27. 27. Possession Utility • The exchange of a product for some monetary value. • Cash • Credit/Debit Cards • Checks • Layaway
  28. 28. Layaway
  29. 29. Information Utility • Information utility – Involves getting the information about the product to the consumer in a timely fashion strategically. • Communication with the consumer • Salespeople • Displays • Packaging and Labeling • Advertising
  30. 30. Consumer Relations
  31. 31. The 4 P’s - Original • PRODUCT Goods – Services - Features - Advantages – Benefits - Packaging – Branding - Installation – Warranty – Accessories • PRICE Flexibility - Over Life Cycle – GeoSocial – Discounts - Allowances • PLACE Channel Types - Market Exposure - Locations of stores – Transporting - Managing Channels - Brick N Mortar/Online • PROMOTION Promotion-Sales-Advertising-Publicity
  32. 32. Now The 7P’s • PRODUCT Focus on solution. Define offerings by need met. • PRICE Focus on value. Price vs. Benefit. • PLACE Focus on access. Purchase touch-points/journey. • PROMOTION Focus on education. Provide relevant 411. • PEOPLE • PROCES • PHYSICAL ENVIRONMENT
  33. 33. Apple Case Study Macro environment • Social factors: • Social trends which change over time • New versions of products to keep up with trends and technological changes in opinions • iPhone 3G, 3GS, 4, 4S, 5, 5C, 5S, 6, 6 Plus • Values, ideas, attitudes and beliefs in which consumers have in regards to these products • Technological factors: ! New innovations and ideas to create new products ! New technologies and introductions of products entice the consumer to buy the product ! Can create negative sides for business " Too hard to keep up with new technology " New products being released straight after each other and not making a substantial profit " MacBook Pro, iPhone, iPod and iPad changed the way the world looked at technology " Revolutionised how the phone is used " Portable technology – on the go • Economic factors: ! Consumer purchasing power and spending patterns " Income and wealth " Money available to spend ! Economic factors of Apple revenue in 2008 were less compared to those in 2009 ! Revenue growth in 2009 increased by 10% ! iPhone and iPod sales increased, however, computer sales decreased by 8% • Political factors: ! Laws and polices that limit the company to work effectively and produce products that go beyond technology and laws ! The governments perspective of what can be sold and bought within a certain country determines the availability and supply and demand of Apple products • Legal factors: • Piracy with music, movies, and app downloads • Apple ensures that it’s database offers completely legal services in which are paid for by it’s users • Apple works with BSA and SIIA to combat worldwide software piracy • Must ensure that all products are protected by copyright laws • All Apple Products do not cause copyright infringements • Similar products to other competitors • Operating software is similar Operating environment • Customers: • Trialling products and providing feedback on products • Customer satisfaction surveys may be used for feedback • Help in determining what products are being successful and what products are not • Enable Apple to see which direction the company should go in when introducing new/developed products • Suppliers: • Crucial when Apple is determining their pricing and profit margins • Ensuring that all parts are working properly and are not faulty • Apple ensures that their workers undertake full training • Suppliers must treat workers fairly and ethically at all times • 349 suppliers in China • 139 suppliers in Japan • 60 suppliers in USA • Competitors: • Competitors influence the pricing of products, and the services in which the product, or Apple as a whole provides • Competitive pricing ensures that there is a market for the product • iPhone vs. Samsung Galaxy • iPad vs. Samsung Galaxy Tab • iMac/MacBook vs. Microsoft computers • OS X Mavericks/Yosemite v. Windows • By having competitors in the market, this ensures that Apple would be able to continue to strive to do better and be better • Interest groups: • Help with new products and with market research • The testing of products before they go on the market • Checking if there are any glitches in the interface • Whether or not the system runs smoothly • The product is user friendly for the specified audience Macro and Operating Environment
  34. 34. Apple Case Study iPhone 6 The target market for the iPhone 6 is primarily high income earners, businessmen, and teenagers. Concentrated segmentation is where Apple produces their products in limited numbers at higher prices. When the iPhone 6 was released, consumers were lined up over 24 hours before the phone went on sale to ensure that they received one. In one store, there were thousands of people lined up, however, there were only 40 iPhone 6s available to purchase. This shows how exclusive the product is, and how Apple aims to produce products that are of high expense, but good quality. High Income earners (High society): • As the phone’s base price to purchase outright is $900, the phone is quite expensive, and those on low income will not be able to afford it • Those ‘rich’ and who keep up with the trend buy the new iPhone each time it comes out, just to keep up and to show that they have the newest technology available Businessmen: • Being the newest technology available, most businessmen and women buy the iPhone due to it’ s versatility and new features • Health app • Tips app • Helps first time iPhone owners get started • Podcast app • Passbook • Keynote • Synchronizes documents and data from each Apple device • iCloud • Helps in organizing meetings and enables the customer to synchr onize numerous devices together to be able to communicate and update each device with ease Teenagers • Teenagers usually want the most up to date technology, therefore, they are a huge target audience for the new iPhone 6 • Demographics • 31% of iPhone users are aged between 35 and 49 • 27% are aged between 25 and 34 • 20% are aged between 18 and 24s • 46% of iPod users are aged between 13 and 17 • This shows that more children and teenagers are using iPods as they may not be allowed to use phones yet • 47% of iPhone users have a household income of over $100k • This shows that Apple customers are high income earners as Apple products are expensive • Music enthusiasts • Media and design professionals as the software available on Apple devices is highly revered by many • Stigmas developed in the 90s about incompatibility with Macs is a huge reason why there used to be less Mac users as opposed to PC users • Apple’s market share and success is predict to boom over the next 10 years as those gen X and Y who have developed those stigmas, establish that those problems do not exist anymore • Apple does not target any specific gender or family size, however, there are apps within Apple’s database in which are gender specific • Geographic • Apple’s largest market is the Chinese • In China, many become attached to luxury goods and ‘worship’ them in means in which they must have those products • The USA and Malaysia are the cheapest places to purchase Apple products • Apple is a global company, however there are numerous countries that are targeted as Apple has a high market share in them: • USA • UK • France • Canada • Germany • Australia • Japan • Italy • China • Behavioural • Those who have purchase an Apple product are almost certain to stick with purchasing Apple products. This is die to growing familiar with the interface which is similar throughout all Apple products • Apple has come to find that Apple users do not just see an iPhone or a Mac as a phone or a computer, but a representation of their life and a part of them • Apple only does market research on their own existing customers so they can see what they can improve, not what other non-Apple customers want Dimensions
  35. 35. Apple Case Study Marketing Mix •Product •Price •Place •Promotion
  36. 36. Apple Case Study Product ! Apple provides both goods and services • The main products include phones, tablets and computers • Services include: • Garage Band • Keynote • iCloud • These services work in conjunction with all Apple pr oducts • Apple also provides support services in most Apple stores which are called ‘Genius Bars’ and they are for help with Apple products and maintenance work ! Apple provides both consumer and business products ! Most products that Apple sells are usually direct to the public ! Apple has business deals with schools and other businesses in which they supply products and software Product Mix ! Breadth: • Mac • iPod • iPad • iPhone • Apple TV • Software's ! Line: • iMac • MacBook/Pro/Air • iPad/2/3/Air/Mini • iPod/Classic/Shuffle/Nano/Touch • iPhone 3G/3GS/4/4S/5/5C/5S/6/6 Plus • iOS • OS X • iWork ! Depth: ! iOS 2.0/3.0/4/5/6/7/8 ! OS X Leopard/Snow Leopard/Lion/Mountain Lion/ Mavericks/Yosemite ! iPhone 8gb/16gb/32gb/64gb/128gb ! iPod 8gb/16gb/32gb/64gb ! iPad 8gb/16gb/32gb ! MacBook with Retina Display Product Life Cycle • With the introduction of the new iPhone, all other iPhones will be on the decline, perhaps not the most recent on prior to the iPhone 6, which is the 5C and the 5S • The iPhone 5C and 5S may be nearing maturity as they both have only bee out for a year, and the iPhone 5S is still similar to the iPhone 6, so may be still in the gr owth stage of it’s life cycle • As for other products, as new versions of the same product are released, the older versions either reach maturity or decline
  37. 37. Apple Case Study
  38. 38. Apple Case Study Place • Apples products go from the manufacturer, to the wholesaler and then finally to the retailer which is either an Apple Store, a certified retailer such as JB Hifi, Harvey Norman, Dick Smiths etc. and online retailers such as Ebay, Kogan and Amazon. Apples products are sold direct to the customer at retail price. • Apple headquarters is located in California (1 Infinite Loop, Cupertino, CA), and there are hundreds of stores located globally. There are over 349 Apple retailers located in China, as the Chinese are Apples largest market. More Apple stores are located in those cities and countries that show a larger market with more and more expensive purchases. • Apple stores and certified retailers are usually located in shopping centers near more upmarket retailers. Apple shops themselves are usually located in a city's central business district as there is more foot traffic heading in that direction and most people work closer to the city or in the city. Being aimed to target those with higher income, apart from being located in the CBDs of cities, Apple retailers are located in upmarket areas of cities and built-up areas. • Apple products are marketed using selective distribution, as more products are distributed to retailers where there is a higher demand for Apple products, whereas a lesser amount is distributed to retailers where there is lesser or no demand for those products • At Highpoint shopping center, Apple is located near other electronic retailers such as Samsung which is one of their main competitors with the Samsung galaxy. • Being placed near or next to their competitors enables there to be constant foot traffic flowing from all competitors, which may lead to new customers. • Apple is a retailer and an online retailer as they sell their products from their stores and sell products online.
  39. 39. Apple Case Study Promotion • Apple promotes their products primarily through television advertisements, online ads, and on billboards • Most Apple products are advertised through numerous different ads. They aim to make an ad that appeals to most segments of the market. Their ads promote different aspects of their products, just like these iPhone ads. They pick out certain parts of the iPhone that can really help sell the phone, and then make a fun ad on it. • iPod packaging stays consistent as the iPods mature and develop. Apple releases the iPods in clear packaging which shows the consumer what the iPod looks like and what they are purchasing. • Apple packaging is very sleek and modern, and promotes their products well because Apple products are very upmarket and expensive. • The packaging shows off the product and promotes a higher level of technology • Apple also have their products set up in their stores for customers to trial and see how their products work before they make up their minds in buy the product. • Although Apple do not have ‘sales’ they have some offers throughout the year, or when it comes to the end of the financial year
  40. 40. Marketing, Business & Strategic Plan
  41. 41. SWOT Analysis To succeed in business, one must plan. A well thought-out marketing plan is at the base of a successful business, and it begins with a self-analysis. SWOT Analysis is key. • Strengths • Weaknesses • Opportunities • Threats • March 1, 1998
  42. 42. SWOT Analysis • Internal analysis - company, customers, and competition. • Company - mission, history, finances, production, marketing strategies (market mix), employees/staff, equipment, and facilities. • Customer analysis includes research on the buying habits, interests, satisfaction, wants, and needs of the target market. Demographics, geographics, psychographics, behavioral, socio-cultural influences, market segmentation, or target marketing. • Competitive analysis = determine how the company compares / market share. • External analysis — factors that can/do impact business. • Strengths and weaknesses of both direct and indirect competition. • Market share, company positioning, reputation, products, and distribution.
  43. 43. Competitive Analysis
  44. 44. Environmental Scan Methodological look at the world that typically includes four areas: • Political, • Economic, • Socio-cultural, and • Technological.
  45. 45. The Marketing Plan A marketing plan is a formal document that outlines the goals, objectives, and strategies of a company. A marketing plan considers three questions: • Is there a need for the product? • Can we market and distribute the product? • What outside influences are going to affect marketing and distribution of the product?
  46. 46. Overview of my approach
  47. 47. Defining Strategy / What’s the plan? 1. Strategic Marketing Objectives 2. Focus 3. Customer Targets 4. Competitor Analysis 5. Differential Advantage 6. Marketing mix 7. Implementation 8. Monitoring market performance
  48. 48. Marketing Strategies
  49. 49. Branding Strategies
  50. 50. SEO Approach
  51. 51. PR Approach
  52. 52. Social Media Approach
  53. 53. E-commerce vs Donor & Membership
  54. 54. Marketing Segmentation Separate customers and/or consumers into smaller buying groups. • Customer = purchases a good or a service, • Consumer = uses a good or service • Sometimes may be same person Four Ways to do market segmentation: 1. Demographics - race, ethnic background, age, gender, marital status, income 2. Geographics - where people live. 3. Psychographics - people's lifestyles and shared attitudes, values, and opinions. 4. Behavioral - product-related behaviors, consumer shopping patterns (as consumers often identify themselves by the brands and products they purchase) and usage rates.
  55. 55. What is Marketing?
  56. 56. Marketing Research Separate customers and/or consumers into smaller buying groups. • Customer = purchases a good or a service, • Consumer = uses a good or service • Sometimes may be same person Four Ways to do market segmentation: 1. Demographics - race, ethnic background, age, gender, marital status, income 2. Geographics - where people live. 3. Psychographics - people's lifestyles and shared attitudes, values, and opinions. 4. Behavioral - product-related behaviors, consumer shopping patterns (as consumers often identify themselves by the brands and products they purchase) and usage rates.
  57. 57. OBJECTIVE: • Form own company in groups of three (3) • Teamwork/collaboration project DELIVERABLES: 1. Company Logo and advertising tagline 2. Mission Statement 3. 1-page SWOT Analysis of your product / brand 4. 1-Page Marketing Plan for launching company Class Assignment: Form own company
  58. 58. break LUNCH Be back by 12:55pm