Appunti Marketing

Marketing

The action or business of promoting and selling products or services.

In simple words, marketing is the process of attracting potential customers and clients to a product

or service.

We can identify four types of companies:

- Product/Technology oriented

- Sales oriented

- Market oriented

- Customer oriented

When we want to sell something, we need also to identify to which segment the process

(marketing) is directed to and so identify the group of people that have the same needs, but those

needs are different from the needs of other people.

In order to better comprehend this process we need to understand the market; the steps to do so are

six:

1) Market de nition

A market is the area of business in which the company intends to operate, to be known and

appreciated and to employ its resources.

The importance in the identi cation of a market stands in fact that it helps to understand what we

must concentrate our attention on and it facilitates communication with the outside.

The rst question any company must ask itself is on which market it want to refer in order to play

an effective marketing action.

Ex.of the quali cation of the market —> Need, Desire and Demand (iPhone)

In general we can identify ve macro environment that characterize a market:

- Potential market —> market that is achieved when the marketing effort is in nite

- Quali ed market —> market with the requisites to be available for the purchase

- Available market —> quali ed plus able to spend enough to buy the product

- Served —> available market that is reached by the marketing effort of the company

- Penetrated —> market that has already purchased products/services in the category

2) Demand Analysis

The purchases volume (q) of a product (p) by a speci c group of customers (c) in a speci c

geographic area (g) in a speci c lapse of time (t) can be calculated in function of the speci c

context (e) and a speci c marketing program (m). 1

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Characteristic of the demand:

- Product or service

- Unit of measure

- Customers

- Geography

- Time

- Level of aggregation

- Players and competitors

The demand is in uenced by some external variables such as economic situation, competitive

system, equivalent product, position in the industry and customers expenditure availability and the

main variables are the product or service, the price, the stores, the promotion and the salesforce.

In order to estimate and forecast the demand there are several processes and methods that can be

used to obtain a qualitative and quantitative valuation of it and the choice of the right model

depends on the speci c objectives and on the availability of quantitive data.

An important thing to do is to estimate the market size and this can be done thanks to some

formulas Q = N x na/N% x Ta x ct.

The information needed to understand the demand and the market size can be obtained thanks to the

desk research: collecting data from existing resources hence it is often considered a low cost

technique as compared to eld research, as the main cost is involved in executive’s time, telephone

charges and directories. 2

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3) Trends

The trends are scenario’s factors that can in uence company’s success; the variables are effecting

supply levels, demand levels and cost structures (we can use PESTLE).

4) Competitor analysis

In order to estimate the power and the in uence of the competitor it can be useful to use Porter’s

model of 5 forces.

When we talk about competitors, we want to know all the market information of them (market share

etc).

Steps to do in order to analyze competitors:

- Identify the company’s competitors

- Assessing competitors’ objectives, strategies, strengths, weaknesses and reaction patterns

- Selecting which competitors to attack or avoid

Competitor Analysis in marketing terms means analysing the competitors in all the items regarding

the strategic and operational marketing.

So it is important to analyze (and de ne related KPI) a lot of items in what competitors are doing,

how much they are investing in marketing activities, what are the results and the quality of the

marketing activities.

5) Micro level analysis of demand B2C

B2C and B2B.

Micro —> customer as an individual/organization with multiple interests

The stimuli-response model

External stimuli (marketing actions) —> customer —> response (purchase decision)

The customer decision process to buy or not is affected by some psychological factors: Perception,

Motivation, Attitudes and Learnings.

The strategic advantage that marketing, and the external stimuli, is trying to capture is a piece of

customer’s mind in order to obtain from her good responses.

(No customer’s mind can store all the external stimuli coming from the market)

Phases as customer clients:

- Recognition of the need (Initiator)

- De nition of the speci cations

- Search of information

- Request for an offer

- Evaluation of alternatives

- Decision (In uencer can in uence the decision, Decider)

- Post-purchase (Buyer and User) 3

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6) Micro leve analysis of demand B2B

In the B2B environment the demand is often derived and particular dynamic and the customers are

other companies.

Factors in uencing the business buying process:

- Situational

- Environmental

- Organizational

- Interpersonal

- Individual 4

fl In supply chain management, the Kraljic matrix (or Kraljic model) is a method used to segment

the purchases or suppliers of a company by dividing them into four classes, based on the complexity

(or risk) of the supply market (such as monopoly situations, barriers to entry, technological

innovation) and the importance of the purchases or suppliers (determined by the impact that they

have on the pro tability of the company). This subdivision allows the company to de ne the

optimal purchasing strategies for each of the four types of purchases or suppliers.

The buying process 5

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Not a single buyer, but a “Purchase centre” with various people and functions involved in the

buying process.

Actors in the buying process :

Initiator: identi es a need and believes it can be satis ed by buying a good or service; activates

the process.

User: uses the product or service purchased; may be the activator of the buying process and

plays an important role in de ning speci cations.

Buyer: has the formal authority and the power to negotiate with the supplier.

In uencer: directly or indirectly in uences the decision process, providing information and

evaluation criteria for the alternatives.

Decider: has the authority to choose between the existing alternatives/proposals and formally

approves the decision

Each actor has his own role and therefore his own objectives and constraints.

The marketing manager’s task is to:

- Identify the roles in relation to the buying situation

- Keep separate the distinct roles

- Identify the decision variables and the services of the purchase that each role sees or has the

authority to see

- Approach each role on the basis of the objectives it maximizes 6

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Assessing the market position

Market share

Relative market share = (market share of the company) / (market share of leading company)

Some brand KPI related to the awareness of the brand:

- Top of mind ( rst brand that comes to mind)

- Unaided awareness (number of people who express knowledge of the brand without prompting)

- Aided awareness (number of people who express knowledge of the brand when prompted) 7

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Targeting

Analysing the market it is necessary to segment it in order to make it more manageable.

Segmentation is a marketing process through which the company divides the market into various

sub-groups (with different demand pro les, but internally homogeneous) on the basis of which

management develops speci c marketing plans to best satisfy their requirements.

Segmentation’s aim is to give insights to markets in order to de ne the best possible marketing

program for every speci c group of customers.

The main characteristics of a good market segmentation are:

- Measurability

- Accessibility

- Homogeneity

- Importance

- Duration Advantages Disadvantages

Reduction in diversity Increased production costs

More focus of resources Increased stocks

Possible creation of entry barriers Increased market research costs

Improvement in customer satisfaction Higher distribution costs

Market share defense Promotion costs

Risk hedging Ine cient resource exploitation

Segmentation types and variables: by product and by customer (B2B or B2C)

Segmentation by product

Advantages: Simplicity, Immediacy and Clarity.

Disadvantages: Simplistic, Little visibility of the competition amongst products and does not

consider the variables related to the customer’s characteristics.

Segmentation by customer

There are three dimensions to consider: customer Characteristic, customer Behavior and customer

Need.

We need to understand from our segmentation who are in the segment, what are they doing and why

are they doing that. 1

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Segmentation by customer - B2C markets

B2C

Knowing customer characteristics, behaviors and needs is fundamental to design the marketing

plan. Marketers collect information and then use them with speci c objectives.

Approach Type of Characteristics Example of Variables

Age, gender, family size, family role, income, occupation,

Socio-demographic social class, religion, etc.

Continent, country, region, type of residence and/or work area

Customer Characteristics Geographic (city, suburb, or rural), population concentration, etc.

Psychographic Personality, lifestyle (VALS™ Test)

User/non-user, brand-user/non-brand-user, intensity of usage,

Product usage type of usage, time of usage, etc.

Customer Behavior Frequency of purchase, point of sales used, duration of

Buying process purchase process, participants in the purchase process,

loyalty to brand or distributor, etc.

Price, quality, safety, variety, functionality, convenience,

Customer Needs Benefits sought entertainment, indulgence, status, etc.

Segmentation by customer - B2B markets 17

Strategy & Marketing - a.y. 2022/23 – Prof. Alberto Cellini

B2B Approach Type of Characteristics Example of Variables

Company size, sector, type of activity, type of

management, etc.

Socio-demographic

Customer

Characteristics Continent, country, region, location (industrial/non-

industrial area), etc.

Geographic User/non-user, consumption volume, product

application type, etc.

Product usage

Customer Behavior Purchase lot size, complexity of buying process, roles in

burying process, distributor to purchase from, loyalty to

Buying process distributors, etc.

Punctuality of delivery, speed of delivery, supply

continuity, technical support, certification, price,

Customer Needs Benefits sought level of customization, etc. 28

Strategy & Marketing - a.y. 2022/23 – Prof. Alberto Cellini 2

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Segmentation methods

- Mathematical —> using statistical-mathematical techniques and algorithms (survey research,

data analysis and segment pro ling)

- Heuristic —> empirical methods (successive elimination approach, two-phase approach or multi-

phase approach)

STEPS TO FOLLOW IN THE ELIMINATION APPROACH

1. Check-list of possible segmentation variables.

2. Variables identi ed as relevant are compared in pairs using a matrix.

3. Unimportant “crossovers” and contradictions are eliminated.

4. Variables are gradually combined to reduce the number of combinations.

5. Products are entered according also to the different use functions.

6. The nal product-market (segments) matrix is built 3

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TWO-PHASE APPROACH DESCRIPTION

MULTI-PHASE APPROACH 4

Marketing strategies

- Undifferentiated —> a single marketing plan for the whole market

- Differentiated —> various marketing plans for the different segments

- Concentrated —> a single marketing plan concentrated on only one segment

TARGET = a target market is a group of customers within a business’ serviceable available market

Marketing strategies

at which a business aims its marketing effort and resources; it is a subset of the total market for a

product or service.

It is possible to look at targeting strategies in more detail by identifying

5 possible approaches.

M1 M2 M3

P1

P2

P3 MARKET SPECIALIZATION

PRODUCT SPECIALIZATION

A SINGLE SEGMENT

Targeting strategies: choice of target segments

TOTAL COVERAGE

SELECTIVE SPECIALIZATION 42

Strategy & Marketing - a.y. 2022/23 – Prof. Alberto Cellini

H High-interest segments, but Segments with high

high investment entry/presence priority

Attractiveness of

segments Segments of no interest Segments to defend only with

marginal spaces (self-

financing)

L L H

Compatibility of segments with the company's new

strategies and resources 5

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Strategy & Marketing - a.y. 2022/23 – Prof. Alberto Cellini

Buyer persona

A buyer persona is a representation of your target customer.

It’s a picture you paint based on research and interviews with actual customers.

Persona development is paramount for the success of an inbound marketing program, no matter the

size or scope of your business.

A generic customer journey can be divided into three stages:

- Awareness

- Consideration

- Decision

Customer experience = sequence of interactions between an individual and a brand occurring

throughout a series of touchpoint, encountered along the customer journey.

These interactions generate cognitive, emotional, behavior and sensorial impacts and reactions. 6

Positioning

Positioning deals with a space dimension and is the phase through which a rm decides how it

wants to be perceived by the market.

The space dimension is the customer mind.

Positioning works on perception; customers automatically compare our offer with the competitors’

one!

Levels:

- Strategic product positioning —> analysing the strength of the product positioning into the

customers’ mind and its differential elements towards competitors.

- Strategic portfolio positioning —> analysing the products/brands mic in a portfolio strategy

perspective.

Objectives:

- To understand which factors customer mostly consider to choose

- To understand the relative importance of each factor in the consumer’s path to purchase

- To value how consumers behave towards competitors’ offers

- To nd “free spaces” for a distinctive positioning

Bene ts:

- It helps to create the right marketing plan

- It helps to nd new marketing niches or generally speaking new opportunities

- It helps to nd a better product positioning through the right marketing leverages

Positioning tools

(In general it is called

Perception map) 1

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Positioning critical success factors

1. Addressed to a precise customers’ segment

2. Linked to a mental category that already exists in the mind of the target

3. Delimited and de ned

4. Simple and clear

5. Long-lasting

6. Coherent

Re-positioning

Positioning changes can be in uenced by the environment, the demand or the competition and so it

is necessary to re-positioning (when? Radical change of the customer or competitors’ strategic

movement). 2

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Re-positioning strategies

Change the perception on one or more feature through one

✦ or more marketing leverage

B XI

X

A

Re-positioning

Strategy & Marketing - a.y. 2022/23 - prof.Alberto Cellini 33

Re-positioning strategies

New product launch on different segments (with di