Preview

1
Preview

• Test Discussion and Project II Discussion
• Evaluations (because of Presentations, Pilgrims)
• Lecture on
• Competitor Analysis
• Customer Analysis
• Sales Forecasting
• Marketing Strategy
• Discussion on Presentation for Two Weeks from
  Now
• Extra Credit Opportunity Three Surveys
• 3 points each, 1 bonus point, 10 points total
• 10 minutes

2
Test Discussion

• Average of 161.4 points (85.7)
• Added 20 Extra points to compensate for questions
  that didnt work out as well as we would have
  liked

3
Project II Discussion

• What were hard parts?
• What went the best?
• Where could you have used the most help?

4
Evaluations

• Malkewitz
• BA 590-001

5
BA 590

• Customer Analysis

6
What We Need to Know about Current and Potential
Customers

• Who buys and uses the product
• What customers buy and how they use it
• Where customers buy
• When customers buy
• How customers choose
• Why they prefer a product
• How they respond to marketing programs
• Will they buy it (again)?

7
Who Buys and Uses the Products

• Initiator -who identifies the need for product
• Influencer -who has informational or preference
  input to the decision
• Decider who makes the final decision through
  budget authorization
• Purchaser who makes the actual purchase
• User

8
Buying Roles and Needs/Benefits Sought
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Categories for Describing Consumers

• Demographic
• Socioeconomic
• Personality
• Psychographics and values

10
Major Segmentation Variables for Consumer Markets
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Major Segmentation Variables for Consumer Markets
(cont.)
12
Major Segmentation Variables for Consumer Markets
(cont.)
13
Lifestyle Typologies
14
List of Values

• Self-respect
• Security
• Warm relationship with others
• Sense of Accomplishment
• Self-fulfillment
• Sense of belonging
• Respect from others
• Fun and enjoyment
• Excitement

15
Major Segmentation Variables for Business Markets

• Demographic
• Operating variables
• Purchasing approaches
• Situational factors
• Personal characteristics

16
Multiattribute Model Questions

• Which attributes do customers use to define a
  product?
• How do customers determine how much of each
  attribute a brand possesses?
• How are the importance weights determined?
• What decision rule is used to combine the
  information?

17
Bank Perceptual Map
B
A
Courteous personnel
C
E
D
Convenient ATM locations
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Sources of Customer Value

• Economic
• The economic benefit a customer derives from
  using a product
• Functional
• Those aspects of a product that provide
  functional or utilitarian benefits to customers
• Psychological
• The image of the product, including how the
  product feels and whether that feeling matches
  the image the customer wants to project

19
Measuring Brand Equity

• Awareness
• Being aware of a brand is usually a requirement
  for its purchase and tends to lead to more
  favorable opinions by reducing the risk
  associated with a familiar option.
• Associations
• Images related to overall quality as well as
  specific product attributes and user
  characteristics affect the reaction to a brand.
• Attitude
• Overall favorability toward a brand is a
  critical part of brand equity.
• Attachment
• Loyalty to a brand is the strongest type of
  equity, and most beneficial for sellers.
• Activity
• The strongest fans of a brand become advocates.

20
Manifestations of Customer Value

• Price.
• Price is the companys assessment of the
  products value.
• Price sensitivity.
• A product with constant sales when prices
  increase generally is of greater value than one
  for which demand slumps.
• Satisfaction.
• Survey-based satisfaction measures are standard
  practice in my business.
• Complaints and compliments.
• The number of complaints or compliments the
  company receives indicates the products value.
• Word-of-mouth.
• Although often difficult to track, spoken and
  written comments provide a useful subjective
  assessment of a products value.

21
Manifestations of Customer Value cont.

• Margin/profit contribution.
• Generally, higher margins indicates partially
  monopolistic positions due to greater
  communicated value.
• Dollar sales.
• Total dollar sales provide an aggregate measure
  of the value of a product as assessed by the
  market.
• Competitive activity.
• Competitive activity such as new-product
  introductions indicates that the total gap
  between customer value and company costs is
  sufficiently large to allow for profits even when
  more companies divide the market.
• Repeat purchase rate.
• High loyalty indicates high brand value.

22
Assessing the Value of the Product Category

• Determine the uses of the product
• Estimate the importance of the uses
• List competing products for the uses
• Determine the relative effectiveness of the
  product category in each usage situation

23
Desirable Criteria for Segments

• Sizeable
• Identifiable
• Reachable
• Respond differently
• Coherent
• Stable

24
Cluster Analysis Illustration
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Customer Analysis Illustration PDAs

• Who the Customers Are
• Primarily upscale mobile professionals
• Predominately male
• Analytical and quantitative in nature
• Well educated
• Over 21 years of age

26
PDA Market Segments
27
PDA Market Segments
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Customer Analysis Illustration PDAs (cont)

• What They Buy
• Small size/light weight
• PC connectivity
• E-mail communications capability
• Phone/address book
• Appointment book/calendar/alarm
• One-way paging

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Important PDA Functions
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Customer Analysis Illustration PDAs (cont)

• Where They Buy
• Buy lower-priced, low feature devices from
  consumer electronics stores and office supply
  superstores
• Higher-end PDAs are purchased from computer
  stores, through mail order, or via the Internet

31
Three Minute Drill

• How Would We Conduct a Customer Analysis for?
• Program to Address Bereavement
• Program to Address Serious Illness

32
BA 590

• Forecasting and Planning

33
Forecasts vs. Potential
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Major Uses of Potential Estimates

• To make entry / exit decisions
• To make resource level decisions
• To make location and other resource allocation
  decisions
• To set objectives and evaluate performance
• As an input to forecasts

35
Deriving Potential Estimates
Data
Secondary data
Calculations
Result
Potential estimate
Past sales data
Model/Statistical method
Surveys/ Primary data
Judgment
Secondary sources
36
How Are Sales Forecasts Used?

• To answer what if questions
• To help set budgets
• To provide a basis for a monitoring system
• To aid in production planning
• By financial analysts to value a company

37
Judgment-based Forecasting Methods

• Naïve extrapolation
• Sales force composite
• Jury of expert opinion
• Delphi method

38
Graphical Eyeball Forecasting
Sales
Range
Forecast










Time
39
Customer-Based Forecasting Methods

• Market testing
• Situations in which potential customers are asked
  to respond to a product concept
• Mall Intercept Surveys
• Focus Groups
• Market surveys
• A form of primary market research in which
  potential customers are asked to give some
  indication of their likelihood of purchasing a
  product

40
Time-Series Forecasting Methods

• Moving Averages
• Exponential Smoothing
• Regression Analysis

41
Potential Customers by Industry and Size
42
Model-Based Methods

• Regression analysis
• Leading indicators
• Econometric models

43
Developing Regression Models

• Plot Sales Over Time
• Consider the Variables that Are Relevant to
  Predicting Sales
• Collect Data
• Analyze the Data
• Examine the correlations among the independent
  variables
• Run the regression
• Determine the significant predictors

44
Bass Model PDA Actual vs. Predicted
45
Sample Format for Summarizing Forecasts
46
BA 590

• Marketing Strategy

47
A Successful Strategy

• Helps achieve coordination among functional areas
  of the organization.
• Defines how resources are to be allocated.
• Leads to a superior market position.

48
Elements of a Product Strategy

• Statement of the objective(s) the product should
  attain
• Selection of strategic alternative(s)
• Selection of customer targets
• Choice of competitor targets
• Statement of the core strategy
• Description of supporting marketing mix.
• Description of supporting functional programs

49
Hierarchy of Objectives
Company Mission/Vision
Level 0
Corporate objectives
Level I
Corporate strategies
Divisional objectives
Level II
Divisional strategies
Product/brand objectives
Level III
Brand strategies
Program objectives
Level IV
Tactics
50
Strategic Alternatives
Long-term profits
Efficiency, short-run profits
Growth in sales or market share
Market development
Market penetration
New segments
Existing customers
Convert nonusers
Competitors customers
New product development
51
Criteria for Evaluating Strategic Alternative
Options

• Size/growth of the segment
• Opportunities for obtaining competitive advantage
• Resources available to penetrate the segment

52
Total Product Concept
Potential product
Generic product
Expected product
Augmented product
53
Five Areas for Differentiation

• Quality
• Status and Image
• Branding
• Convenience and Service
• Distribution

54
Joint Space for Colas
55
Brand Equity
56
Brand Equity cont.
57
Some Brand Attribute and Image Dimensions
Attributes
Image Dimensions
Reliableunreliable Oldyoung Technicalnontechni
cal Sensiblerash Interestingboring Creativenonc
reative Sentimentalnonsentimental Impulsivedelib
erate Trustworthyuntrustworthy Conformingrebelli
ous Daringcautious Forcefulsubmissive Boldtimid
Sociable-unsociable

• Color
• Style
• Comfort
• Freshness
• Construction material
• Availability
• Serviceability
• Compatibility
• Energy efficiency
• Instructions
• Automation
• Ease of Use

• Flavor/taste
• Caffeine content
• Price
• Packaging
• Size
• Calories
• Brand name
• Sweetness
• Weight
• Warranty
• Durability
• Convenience

58
Ten Guidelines for Building Strong Brands

• Brand Identity
• Each brand should have an identity, a
  personality. It can be modified for different
  segments.
• Value Proposition
• Each brand should have a unique value
  proposition.
• Brand Position
• The brands position should provide clear
  guidance to those implementing a communications
  program.
• Execution
• The communications program needs to implement the
  identity and position, and it should be durable
  as well.
• Consistency Over Time
• Product managers should have a goal of
  maintaining a consistent identity, position, and
  execution over time. Changes should be resisted.

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Ten Guidelines for Building Strong Brands (cont.)

• Brand System
• The brands in the portfolio should be consistent
  and synergistic.
• Brand Leverage
• Extend brands and develop co-branding
  opportunities only if the brand identity will be
  both used and reinforced
• Tracking
• The brands equity should be tracked over time,
  including awareness, perceived quality, brand
  loyalty, and brand associations.
• Brand Responsibility
• Someone should be in charge of the brand who will
  create the identity and positions and coordinate
  the execution.
• Invest
• Continue investing in brands even when the
  financial goals are not being met.

60
Basic Customer Strategies

• Customer acquisition
• Customer retention
• Customer expansion
• Customer deletion

61
Presentation

• See Folder for Guidelines
• Feedback from Both Class and From Me
• 20 minute presentation
• All group members present (3 minutes)
• Content of Presentation 100 Points
• Quality of Presentation 100 Points
• 75 Marketing Plan, 25 NPD Process
• 200 points total

62
Surveys Extra Credit

• Administer Three Surveys
• Place all three in Folder
• Prevents Redundancy of your filling out the
  male, 37 years, etc. data three times
• The first and third survey are for one of my
  research colleagues, the second one is for
  another colleague at Washington State University
  
• If you would rather not take the surveys for a
  Cougar, please send me an e-mail and Ill take
  care of it for you (i.e., make sure you get the
  points as well)