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Discipline For Marketing Impact
- 1. Confidential Do Not Duplicate or Distribute William N. Nemecek
- 2. Word of Mouth The Marketing Funnel The Marketing Funnel provides a framework for buildingdeeper relationshipswith customers by guiding them from brand awareness through advocacy Market cognizant of company, product, service and/or brand Transitionfromcognizance to considerationof company, people, product, service, and/or brand Adoptionof company, people, product, service, and/or brand Commitment tocompany, people, product, service, and/or brand Promotion of company, people, product, service, and/or brandtoother customers or users Confidential Do Not Duplicate or Distribute William N. Nemecek
- 3. Marketing Strategy Roadmap Establishdisciplinedprocesses for developingmarketing strategies and a roadmapfor objectivemeasurement, critical analysis,and continuousimprovement. Confidential Do Not Duplicate or Distribute William N. Nemecek
- 4. Business Value Creation Network Collaboration Businesssegments contribute to, and help support and enable, value proposition development,delivery,and longevity. Finance and accounting determine capital resource allocation and manage business controls Marketing identifies market segments and opportunity, gives the business acommon voice, anddevelops competitive positions Sales manages delivery of products, services, and value messages while delivering the voice of the customer Operations supportsproducts, services, and the value message and brand promise commitment Business value is createdwhen all functional efforts alignagainst common value and brandpromises Confidential Do Not Duplicate or Distribute William N. Nemecek
- 5. Marketing Control Loop Marketing plans are 'living cycles'. The revolving nature of the marketing control loop enables ongoing data analysis and amendments. Identify market-segments to addressed in order to maximize the firm’s potential Investigation of all relevant data regarding customers, competitors, market-segments, partnerships,etc. Quantity, capture, retention, cross-sell, turnover,profit, etc.) to be achieved Actionsrequired to reach objectives per market and/or market segment Strategy, product-mix, messaging, communication channels/media, etc. required to compelaction/response Ongoingprocess of continuous improvement incorporatesevaluation of loop data points for future improvements Data regarding experience,satisfaction, value, and misses from customers, surveys, partners, and sales channels Management of each market/segment for production,costs, profit, etc. Deliveryofvalue proposition, service,and support via effective sales, distributors, partners, licenses, etc. 1 2 3 4 56 7 8 9 Confidential Do Not Duplicate or Distribute William N. Nemecek
- 6. The Four “P’s” of Marketing Elementsof the Marketing Mix, Product, Price, Place, and Promotion, focus on motives and assure resource alignmentand optimization todelivervalue Confidential Do Not Duplicate or Distribute William N. Nemecek
- 7. Extended Marketing Mix People Process Physical Evidence The Extended Marketing Mix The Extended MarketingMix; People, Processesand Physical Evidence, advance considerationsaddressingadditionalinfluences,motives, and behaviors Confidential Do Not Duplicate or Distribute William N. Nemecek
- 8. The Value of the Value Proposition The ValueProposition positionsstrengths and differentiatesthe business, product, and/or service from competition offering similarproducts/services. Business Assessment – Define the “as is state.” What does the business do well? Target Market – Define target market segment: Which customers are best to work with? Which are best to walk away from? Customer Needs Assessment – What are the specific needs of your target segment? How well does the firm service those needs today? Competitive Analysis – Who is the firm currently competing with? Who might the firm be competing with in the future? Performance Analysis – Does the firm’s "as is" value proposition align with its target market? Does it create positive differentiation from the firm’s competitors? Develop and Deliver a Powerful Brand Promise – Identify realistic ways to improve the firm’s model, products/services, processes and employees to deliver and support the Value Proposition. Confidential Do Not Duplicate or Distribute William N. Nemecek
- 9. Developing The Value Proposition A well developedValueProposition acts as an enabler for the organization tocompeteon theirown terms rather than competingon price only. Self-Assessment– Define the "asis"state of the firm. What doesthe organizationdo reallywell? What are the strengthsofthe business?Whatdifferentiatesthe businessfrom the competition? DefineandSegment– Identifythe firm’stargetMarket& CustomerSegment. Define the markets/customers/clientsthe firmreallywantstoworkwith versus those the firmdoesnotwishto workwith. CustomerAssessment– Analyze andassesscustomers’specificneeds. Determine the firm’slevelof effectivenessservingthoseneeds. Competitive Analysis– Researchthe competition.Whoiscompetingforthe firm’scustomersrightnow? Which competitorsare servingcustomersegments the firmhopestoreach in the future? Resonance Testing– Examine the firm’s"as is" value proposition.Determine whetherthismatchesthe firm’stargetmarket,differentiatesthe firm’sbusiness, isdeliverable,andwill capture the market. ContinuousImprovement– Identifyrealisticwaysto enhance the firm’smodel, products/services,processes,employees,andresourcestodeliverthe idealvalue proposition. Confidential Do Not Duplicate or Distribute William N. Nemecek
- 10. Brand Value Chain Marketing Programs Brand Image Brand Equity Economic Value • Advertising • Promotion • Email • Packaging/Bundling • Channel Incentives • Etc. • Awareness • Attributes • Characteristics • Points of parity • Points of difference • Attitudes • Associations • Attachments • Personality • Preference • Permission • Translating Equity into profit • Pricing power • Distribution advantage • Expense reduction • Etc. Effectiveness Clarity Distinctiveness Consistency Relevance Relative Strengths Comparative advantages Correlation Drivers Objectives Outcomes The Brand Value ChainModel presents a means to execute marketing strategy and measure resultsand progress from brand related marketing efforts Confidential Do Not Duplicate or Distribute William N. Nemecek
- 11. Marketing Split Test A hallmark of marketing is the abilityto objectively test, measure and judge results. Test andcontrol disciplinesenable ROI measurement and improvement. Confidential Do Not Duplicate or Distribute William N. Nemecek
Editor's Notes
- ANALYSIS/IDENTIFICATION:1. Market research = identification of the markets/market segments already or not yet supplied by the company resp. the market-segments which must/could/should be dealt with in order to exhaust the company's potential and/or to develop possibly new products (also considering the available core competences !). 2. Market analysis = investigation of all relevant data regarding customers (who, where, size, turnover, etc.) per market-segment, competitors, marketing ways, potential synergy-partners, distributors, etc., which are meaning-/useful to/for the company's products.PREPARATION/OBJECTIVES: 3. Definition of the targets (quantity/turnover/profit, etc.) to be reached by means of good basic figures, incl. budgeting, possible realization, organizational preparation, targets/ markets, timing, etc.PLANNING/REALIZATION: 4. Elaboration of the marketing steps needed to reach each of the objectives per market/ market-segment, i. e. from production to customer care, incl. sales, services, logistics, etc.5. Decision about the marketing-mix for these steps - i. e. the strategy, the product-mix, the communication media, etc.6. Execution/implementation of the results - from public relations, via effective sales (distributors, representatives, synergy-partners, licenses, sales programs, incentives, etc.) to service and after-sales treatmentFEEDBACK + CONTROL: 7. Control of the results achieved - each market/market segment -, based on defined parameters, for production, sales, cost, turnover/ profit, etc. 8. Incorporation of the feedback from sales and clients with regard to their problems to be solved, new products to come, new clients of them and thus the needs of the final buyers9. Permanent, timely agreed/defined revision of this loop in order to let enter new findings, correct planned figures/results and to take them into consideration in future decisions - for any relevant marketing/sales task.
- Elements of the marketing mix are often referred to as 'the four Ps': Product – A tangible object or an intangible service that is produced with a specific volume of units. Packaging also needs to be taken into consideration. Every product is subject to a life-cycle including a growth phase followed by an eventual period of decline as the product approaches market saturation. To retain its competitiveness in the market, product differentiation is required and is one of the strategies to differentiate from its competitors. Price – The price is the amount a customer pays for the product. It is determined by a number of factors including market share, competition, material costs, product identity and the customer's perceived value of the product. The business may increase or decrease the price of product if other stores have the same product. Place – Place represents the location where a product can be purchased. It is often referred to as the distribution channel. It can include any physical store as well as virtual stores on the Internet. Place is not exactly a physical store where it is available Place is nothing but how the product takes place or create image in the mind of customers. It depends upon the perception of customers. Promotion - represents all of the communications that a marketer may use in the marketplace. Promotion has four distinct elements: advertising, public relations, personal selling, and sales and promotion. A certain amount of crossover occurs when promotion uses the four principal elements together. Public relations are where the communication is not directly paid for and includes press releases, sponsorship deals, exhibitions, conferences, seminars or trade fairs and events. Word of mouth is informal communication about the product by ordinary individuals, satisfied customers or people specifically engaged to create word of mouth momentum. Sales staff often plays an important role in word of mouth and Public Relations. Before introducing products or services into the market, organizations should conduct a market survey. The sequence of all 'P's as above is very much important in every stage of product life cycle Introduction, Growth, Maturity and Decline.
- Three Ps, People, Process and Physical Evidence, have been added to the marketing mix. This marketing mix is known as Extended Marketing Mix. People: All people involved with production and consumption of a service are important. For example workers, management, consumers etc. It also defines the market segmentation, mainly demographic segmentation. It addresses particular class of people for whom the product or service is made available. Process: Procedure, mechanism and flow of activities by which products and services are produced and used. Also the 'Procedure' by which the product will reach to end use, after starting its journey from manufacturer. Physical Evidence: The environment in which the service or product is delivered; tangible are the one which helps to communicate and intangible is the knowledge of the people around us.
- The Brand Value Chain (adapted from Kevin Keller of Dartmouth and Don Lehmann of Columbia) helps clarify and document, for all to see, the anticipated relationship between elements of an integrated marketing program and financial value created through stronger brand equity. In the simplest version of the Value Chain, an integrated campaign leads to some evolution in brand image, which in turn leads to some change in “equity”, which then translates into financial value.The best way to understand the Brand Value Chain is to begin with the end in mind. Specifically, what sort of financial value is the integrated campaign supposed to lead to? Is it intended to increase the incidence of purchase? To decrease price sensitivity? To open new distribution channels through superior category leverage? To project more powerful negotiating position to vendors and suppliers? Or some combination of the above?The Brand Value Chain tests your ability to clarify your expectations logically and to define the specific dimensions upon which brand “equity” must evolve to achieve them. How are you expecting the thoughts, beliefs, attitudes, associations, and permissions people ascribe to the brand to change or grow? What do you believe precedes seeing the desired economic behavior?Finally, the “image” results are the early indicators (e.g. salient awareness, attribute- or characteristic-specific awareness, or more accurate awareness of the brand’s points-of-parity and/or points-of-difference) of progress. While important, they are a necessary but insufficient condition for a profitable outcome. Acknowledging this works to establish the necessity of time to translate imagery into equity into financial gain.Once you have the Brand Value Chain constructed in a way that reflects your hypotheses about the way things work, you can identify which links in the chain you are able to test/read/validate and which you cannot. This brings focus to the information gaps and raises the question of tradeoffs between the cost and value of further insight for all to assess. If finance is so keen to have precise insight into the financial outcomes of brand advertising, they should be willing to invest in the research, testing, and experiments that would have to go into properly tracking the flow of results through the value chain. Otherwise, they will have to accept informed assumptions and estimating processes which find the balance between cost and benefit.The Brand Value Chain has one significant flaw as it appears here. It follows the now widely discredited “hierarchy of effects” theory, which prescribed that awareness leads to conscious consideration which in turn precedes behavior. This linear model has been found to have only limited validity in the real world. However, the Value Chain does provide a great starting point for you to map out how you think your category dynamics operate so you can construct one in a format that is most relevant to your business.Measuring the impact of integrated marketing over the long run is possible with the application of the right tools and processes. Research, experimental design, factor analysis, and continuous feedback mechanisms all play a role in reducing the unknowns down to comfortable risk levels. It just takes some clarity and precision in defining expectations for marketing’s payback by building financial bridges from short- to long-term value creation.
- Determine which media you will use for your direct marketing. Print ads and postcard marketing are two examples. Direct mail letters, television commercials, print ads and any kind of postcard marketing are common marketing efforts that can be tested. Use your current marketing piece as the control. You should already know the response rate in percent and dollars, along with the costs for the control. If you do not have a control, your first direct marketing effort should be sent or distributed without a test to establish a control. You can also use your best guess as the control package, but this will not yield the most accurate results. Using your control package or ad, make one change to it. You can only make one change. Making more than one change adds too many variables and you will not be able to tell which variable led to either the increase or decrease in response rate. Common variables to test include the creative (copy or graphic design), the offer (low price, buy one get one, buy one get half off), or an incentive (free shipping vs. gift). Be sure you have two separate response mechanisms in place, one for EACH creative - the control and the test piece. You need to be able to track orders and response back to the original creative piece. You can make up a unique URL and use URLs to track responses, a coupon code for each response, or a separate toll free number. As long as you can see the results from each piece, the control and the test panel, you are okay. Mail, print or otherwise release the creative. Allow 6-8 weeks for the test and carefully track all data, including (depending on the medium): number of responses, number of new customers, number of return customers, average dollar order, etc. Add this data to the Excel spreadsheet. Create a spreadsheet with separate columns for each data point. Make sure you track on separate worksheets or side-by-side the data from each campaign. Now compare. Which piece gave you the higher response rate? The higher average dollar order? More new customers? That's the winner of your split test.