Positioning

The process that marketers make their product different such that:

1. It is unique in customers minds
2.  That uniqueness is relevant to customers in some way that makes them prefer the product.

4 P's of marketing

Product:brand, quality, size, service

Price:credit terms, discount, strategy

Place:Transportation, location, distribution

Promotion:advertisingstrategy (push/pull), public relations communication.

BCG Matrix

Used to determine priorites that should be given in product portfolio.  The bigger the market share a product has or the faster the products market growth the better it is for the company.

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Segmentation

Identifying a group of customers who share similar set of needs and wants.

ex. among car buyers: safety conscious, green, speed, power.

Targeting

Need based market segmentation approach.

1. Group customers based on similar needs.
2. Determine demographics.
3. Determine profitability.

How will new technology trends affect marketers?

Innovation - changes what people can/will buy.

Cell phone/internet marketing

tracking purchasing trends

twitter - immediate results.

Behavioral - Historical: buy-->therefore loyal

Attitudinal - Future intentions.  Attracted to the image of the brand.  -->more loyal to price than brand.

1. contractual i.e. cell phone contracts and
2. retention situations i.e. Magazine subscriptions and car insurance
3. Both deal with lost for good customer mentality.

1. find, attract and win new customers.
2. nurture and retain current customers.
3. entice former customers to come back.
4. reduce costs of marketing and customer service.

What is a means-end chain model of consumer meaning?

Relates product-->benefit-->personal value.

identifies concrete, abstract, functional, psychosocial, instrumental and terminal.

Ex. Mouthwash:

Kills germs (concrete),

Better breathe (functional),

Increase confidence (psychosocial), perform better(instrumental)

more self esteem (terminal)

Business or consumers that transact with one supplier of a good at a time and are resistant to change because of high switching costs or other reasons.

If they leave, they are "lost for good".

What are the main differences between consumer and B2B markets?

Who you sell to, order type/size, payment, method of connecting, relationship.

B2C: Individual, single purchases, credit cards, storefront, short term relationship.

B2B: Businesses, repeat orders, line of credit-->open orders, longer term relationships.

B2B: Normally small, focused target market, B2B features multistep buying process and longer sales cycle.  Businesses may use training custom development to promote their business.

B2C: Large target market, single step buying process & shorter sales cycle.  Focus on merchandising & point of buying activities i.e. coupons, displays & storefronts.

What is a push strategy?

Pull strategy?

Push: attempt to create consumer demand for a product.

Pull: production responds to demand.  customers order the product, producers respond.  "Dell" or People waiting on line for the iPhone.

"identifying and satisfying consumer/business needs"

Primary: research that's tailored to a company's particular needs.  Focus groups, surveys, field tests, interviews or observations are used to gain information about your target market.  Information delivered is more specific, but also much more expensive and time consuming.

Secondary: Data based on information gleamed from studies previously performed by the government, chambers of commerce, trade associations, etc.

2ndary data is faster and much cheaper, BUT: is not always avail for your topic, may be biased(often), may not be up to date.

Mystery shoppers: market researchers act like patrons & execute specific tasks such as a purchase complaint or returning item.  Report feedback to mgmt.

Focus groups: Group asked about their perceptions, opinions, beliefs 7 attitudes toward a product, service, concept, advertisement, etc.

IDI's Focus Facility: in depth interview facility, one on one.

Asking questions that are not targeted enough to be actionable.

Aside from exploratory research, it should be conducted with a specific idea in mind about how the data will be used.

Mail: Advan cheap--> especially for large samples. Can include pictures and longer questions.

Disadvant: some not returned, hard to follow-up

Internet: Advan: Quick, inexpensive, large sample, no human influence

Disadvan: ID verification/ tech difficulties

Phone: Advan: better response to open ended questions.  control over question order/presentation.

Disadvan. Expensive (salaries)

door to Door: Advant: better response to open ended questions.  Control over order of questions.

Disadvant: reluctance or sensitive topes.  Not trusting of strangers.  Expensive.

Target market: the particular segment of a total population on which the retailers focuses its merchandising expertise to satisfy that submarket in order to accomplish its profits.

Look at segment: size, how fast its growing, level of competition amongst existing firms, existing loyalty in the segment.
Look at potential level of marketshare expected to obtain, total sales potential of the segment.
A firm that is seeking to enter a market and grow should 1st target the most attrative segment that matches its capabilities.

The market must be identifiable and measurable.  How big is market?  MPR's

The market must be big enough to be profitable. ex. tricycle for children 7 feet tall.

The market must be reachable.  Marketers must be able to communicate effeciently and effectively with target.

Segment must be responsive to your offers and wiling and able to purchase product.

The segment should be stable.

Demographic: personal characteristics such as age, gender, income, lifestage, education. 

Pros: most popular bc usually match consumers wants &/Or needs.  Easy to measure and obtain.

Cons: not usable where consumers deciding factor is price.  Also, same demographic group can have different psychographic profile.

Psycho-graphic: based on traits, attitude, interest, lifestyle

Pros - great understanding of customer.

Con - Not always tangible

Geographic:Based on Where people live. ex. neighborhoods, cities, states, urban, rural, climate

Pro - should be only one language, tailor product to people likening (race, religion)

Con - Not eveyone in same area have same taste or respond the same.

Behavioral - based on actual customer behavior toward product: ex. brand loyalty, user status, occasions.

Pro - Tangible, because historical, only purchased product --> loyal.

Con: costly and time consuming.

Positioning: the way that markets make their product different such that: it is unique in customers mind and that uniqueness is relevant to customers in some way that makes them prefer the product.

means-end model - consumers create linked meanings that connect tangible product attributes to more abstract attributes and consequences.  Which in turn are associated with more subjective, self relevant values and goals. 

Together, positioning using a means end perspective would focus on making a product different in a customers mind based on the customers values or emotional benefits.  

Class ex. iPhone based on emotional benefits, such as: social acceptance at Baruch and feelings of efficiency and fun during usage. 

Introduction, Growth, maturity and decline.

Introduction: costs high, slow sales, little or no competition

Growth: cost reduced due to economies of scale

Mature: cost lowered b/c production volume.

Saturation/Decline: cost become counter, sales volume declines, profitability deminishes.

Strategic implications: Products have a finite life.  During that life, they pass through a series of different stages, each of which posses different challenges to the seller.  Virtually all elements of the organizations strategy need to change as the product moves from one stage to the next.  The profit potential of products varies considerably from one stage to another.  

Schumpeter's theory of creative destructionism.

The economist believed that new products kill older products.  Ex. Invention of automobiles destorys the horse and buggy market.  Personal computers destroyed typewritter market.

Theory can be intertwined with the lifecycle of a product.

Ex. music.

8 tracks are up when cassettes invented.

8 tracks go down and cassestes up as CD's are invented.

Cassettes go down and CD's go up as MP3's are invented.

etc.

-->new products stay at the maturity phase until a newer(better) product moves it to its last phase - acted upon.

The technology substitution  model was designed to analyze the penetration process of new generation technologies replacing old ones.  It expanded to include more than two generations and the process amount various entities in the market.  

Technology substitution: how fast one technology replaces another.

e. none of the above

NOT POSITIONING!

High quality secondary data can usually be found to fit the problem if you are willing to pay for it.

Not: secondary data were collected for a purpose other than the one at hand 

OR

Secondary data are found in both internal and external data sources 

OR

Secondary data may be gathered quickly.

A - Mobile phone service

NOT

Online book sales

Automobile sales

Pizza sales

They are all equal.