1. Lecture 3: Marketing Plan, Strategies,
Distribution and Channels
Dr Bernard Leong
CTO & Co-founder
MPS 812 Course Taught in:
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2. What is Marketing?
• Marketing dealswith identifying &
meeting humanandsocial needs.
• Marketing is “an organizational
functionandasetof processesfor
creating,communicating& delivering
valuefor customers& for managing
relationshipsin waysthat benefitthe
organizations& itsstake
holders.”(American Marketing
Association)
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3. What is Marketing?
• Marketing Management: the art &
science of choosing target
markets & getting, keeping &
growing customers thru creating,
delivering, & communicating
superior customer value.
• Marketing is asocietal process by
which individuals & groups obtain
what they need andwant thru
creating, offering & freely
exchanging products/services of
value with others.
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5. Marketers & Prospects
• A marketer: Someoneseekingaresponse
(attention, apurchase, vote, donation) from
another party call the prospect.
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6. 8 Demand States
• Negative Demand: Consumers
dislike the product & may pay a
price to avoid it.
• Non-existent Demand:
Consumers are unaware or
uninterested in the product.
• Latent Demand:Consumers
shareastrong needthat cannot
besatisfied by an existing
product.
• Declining Demand:Consumers
beginto buy the product less
frequently.
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7. 8 Demand States
•
•
•
•
Irregular Demand:Consumer
purchasesvary on aseasonal,
monthly, weekly, daily or evenhourly
basis.
Full Demand: Consumers are
adequately buyingall products put in
the market place.
Overfull Demand: More consumers
would like to buy the product that
canbesatisfied.
Unwholesome demand:Consumers
maybeattracted to products that
haveundesirable social consequences.
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16. How to SetthePrice
•
•
•
•
•
Selectingthe Price Objective - Position
of market offering due to survival,
maximum current profit, maximum
market shareor maximum market-
skimming pricing.
Determining Demand- Price Sensitivity
- methods include surveys,price
experiments andstatisticalanalysis.
Estimating Costs - Chargingaprice
basedon cost of producing, distributing
andselling of aproduct.
Analyzing competitors’ costs, prices &
offers
Selectingaprice method: for e.g.
markup pricing, target return pricing,
value pricing.
High Price
(No possible demand
at this price)
Low Price
(No possible profit
at this price)
Costing Price
Customers assement of
unique product features
Orienting Point
Competitors’ prices & prices
of substitutes
Costs
Floor Price
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17. Promotion: Common Platforms
Advertising
Sales
Promotio
n
Events/
Experienc
es
Public Relations
& Publicity
Person
al
Selling
Direct
Marketin
g
Print & Broadcast
Ads, Contests,games,
Sports,
Entertainmen
t, Festivals,
Arts,
Courses,
FactoryTours,
Company Museums,
StreetActivities
PressKits,
Speeches,
Seminars,
Annual Reports,
Charitable
Donations,
Sponsorships,
Publications,
Community
Relations,
Lobbying,
Identity Media
Company Magazine
or newsletters
Salespresentations,
Salesmeetings,
Incentive programs,
Samples,
Fairs andTrade
Shows
Catalog
s,
Mailings,
Tele-marketing,
Electronic Shopping,
TV shopping,
Fax-mail
Email
Voice mail
Packaging-outers, sweepstakes,
Packaging inserts, lotteries,
Motion Pictures, Premium & gifts,
Brochures & Samples,
Booklets Fairs& trade shows,
Posters & leaflets, Exhibits,
Directories Demonstrations,
Reprint of Ads, Coupons,
Billboards, Rebates
Display Signs, Low-interest
Point of purchase financing,
displays, Entertainment,
Audiovisual Trade-in allowances,
materials, Continuity
Symbolsand logos Programs,
Videotapes,CD,
DVDs
Tie-ins
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18. Place
• Distribution Channel
• Integration basedon Merger
&Acquisition:
• Manufacturer acquires
Wholesaler (Forward
Integration)
• Wholesaler acquires
Manufacturer (Backward
Integration)
• Retailer buysover another
Retailer (Parallel
Integration)
Customer
Retailer
/
Dealer
Wholesaler/
Distributor
Manufacturer/
Sole Importer
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21. Strength/Weaknesses
Functionality
Features to measure performance or
importance
Marketing
Company reputation, Market Share,Customer Satisfaction,
Customer Retention, Product or Service Quality, Pricing
Effectiveness, Distribution Effectiveness, Promotion
Effectiveness, SalesForce Effectiveness,Innovation Effectiveness,
Geographical Coverage.
Finance Cost & Availability of Capital, CashFlow, FinancialStability.
Manufacturing
Facilities, Economics of Scale,Capacity,Able & Dedicated
Workforce,Ability to produce on time,Technical manufacturing
skill.
Organization Visionary & capableleadership, Dedicated Employees,
Entrepreneurial Orientation, Flexible or Responsive.
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22. Opportunity/Threat
•
•
A marketing opportunity is anarea
of buyer need& interest in which
there is ahighprobability that a
companycanprofitably satisfy that
need.
Three main sourcesof market
opportunities:
•
•
•
Supplysomething that is in
demand.
Supplyingproduct or service in a
new or superior way.
Totally new product that bring
about anew consumer behavior
or impact.
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23. Opportunities
•
•
•
•
•
•
•
A companymaybenefit from converging
industry trends & introduce hybrid
products or services that are new to the
market.
A companymaymakeabuying process
more convenient or efficient.
A companycanmeet the need for more
information or advice.
A companycancustomize aproduct or
service that wasformerly offered in a
standard form.
A companycanintroduce anew capability.
A companymaybeableto deliver a
product or service faster.
A companymaybeableto offer aproduct
at amuch lower price.
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24. Questions for Market Opportunity Analysis
• Canthe benefits involved in the opportunity be
articulated convincingly to adefined target market?
• Canthe target market(s) belocated & reached with
cost effective media & trade channels?
• Does the company process or have access to the
critical capabilities & resources needed to deliver
customer benefits?
• Canthe companydeliver the benefits better than any
actual or potential competitors?
• Will the financial rate of return meet or exceed the
company’sthreshold for investment?
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25. 1 2
3 4
Attractiveness
Hig
h
Lo
w
SuccessProbability
High Low Example
1. Company develops
more powerful
lighting system.
2. Company develops
device to measure
energy efficiency.
3. Company develops
device to measure
illumination level.
4. Company develops
software program to
teach lighting
fundamentals to TV
studio personnel.
Opportunity Matrix
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26. 1 2
3 4
Seriousne
ss
Hig
h
Lo
w
Probability of Occurrence
High Low Example
1. Competitor
develops superior
lighting system.
2. Major prolonged
economic
depression.
3. Higher Costs.
4. Legislation to
reduce number of
TV licenses.
Threat Matrix
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27. Marketing Channels
• Marketing Channels are sets
of interdependent
organizations involved in the
process of marketing a
product or service available
for consumption and use.
• Setof pathwayswhich
follows after production,
culminating in purchase &
usebythe final user.
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28. Push/Pull Strategy
• A pushstrategy involves the manufacturer using
its salesforce & trade promotion money to
induce intermediaries to carry, promote & sell the
product to the end-user.
• A pull strategy involves the manufacturer using
advertising to induce consumers to ask
intermediaries for the product andis appropriate
when there is high brand loyalty & involvement in
the category when people perceive differences
between brands.
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30. What is branding?
•A brand is the symbolic embodiment of all information encoded
with aproduct or service.
•Branding is the process bywhich acompany,product or image
becomessynonymous with aset of values,aspirations or states.
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35. Commitment & Consistency
•People haveageneral desire to appear consistent in
their behavior.
•Strong desire to commitments by providing reasonsto
justify them.
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40. Inventory Storage& Distribution Costs Insignificant
User Driven Innovation
Opportunities for Niches Markets
Signalto Noise ishigher
Niche getting to the Mainstream is tough
Platforms are “Walled Gardens”
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42. Why Startups needSocial Media
• Getting the attention of the
mainstream media.
• Budget constraints and not
able to afford big marketing
budgets.
• Advertising andMarketing
purposes.
• Crisis managementgivenno
PRchannels
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45. Mainstream Media Social Media
Principle behind
Channel Distribution 80-20 Rule LongTail
Users Consumers Prosumers
Channel Examples Cable TV,Radio,Printed Media-
Newspaper
YouTube,Blogs,Social Networks
(Facebook, Ning), Flickr,Twitter
UStream,Qik,Wikis
Approach Topto Bottom Bottom Up (Niche)
to Top
Feedback/Engagement Very little A lot
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