Strategic marketing - Marketing strategico Wrap up

But qualitative research has no statistical significance so firms don’t have to take decisions

only on these results. Usually the output of a qualitative research is the input of a

quantitative research so firms have to make a mix between the two tools to get an optimal

result.

An other tecnique is the laddering. We have different types of laddering:

Direct laddering: ask customers some questions about the product. Ex. Why did

- you buy this product? Which characteristics did you take into consideration?

Comparative laddering: by the comparison of some products, I can understand

- the critical attributes, benefits and value that customers take into consideration in a

strong way

Projective laddering: I don’t ask directly but I ask customers for example “if you

- were a friend of yours, what would you chose?”

Negative laddering: I ask what you would never find in a product

- Contestual laddering: I ask customers to tell me their last experience with a

- product.

There are also other techniques such as C.I.T (critical incident technique). It’s positive

(tell me the best experience you did with this product) or negative (tell me the worst

experience you did with this product).

In general we can say that first the questions have to be generic and then specific.

The output of a qualitative research is a list of benefits and attributes that help us to

understand the measure of importance and the measure of perception of these attributes

for customers. These are the inputs for a quantitative research.

Measurement of the value for customers. Three techniques to measure the value:

EVC (economic value for the customers)/TCO (total cost of ownership)

- Fishbein

- Conjoint analysis

-

EVC is a desk technique (it means I don’t have to buy data to do it, vs field research)

It’s management based

(fishbein and conjoint are customer based, field techniques because you can’t

measure the value without doing a market research. It’s necessary to go field to measure

the level of value perception of customers).

The best technique to use depends on what you have to measure. From the methodology

point of view, field research are more usefull and sophisticated.

EVC helps us to estimate the value for the customers by estimating the benefits related to

the product compared to an other offer.

So, to run EVC analysis we have to:

Identify the most rilevant attributes from a qualitative research

- Select attributes paying attention to the possibility to measure and observe them in

- a very simply and objective way

Measure of attribute level comparing to the main competitor

- Convert the attributes differential (my prod and my main competitor’s prod) in

- monetary units.

Advantages of EVC: (better in B2B markets)

Cheap

- Simply

- Quick

- Easy to communicate

- Key selling point

-

Disadvantages of EVC:

- Works only with functional and esplicit attributes (not symbolic/implicit)

- Need a competitor

- Need reliable data/sources

- Should be able to translate each benefits in monetary terms

FISHBEIN

Qualitative reseach gives a list of attributes, then we open the measurement phase in terms of

importance and perfomance. The first one means that the customers have to rank it by percentage

or a scale and valuate them (the risk is that customers give only high rank) and the perfomance

means the evaluation of my product and my competitor’s.

Fishbein index: the value index is the weighted average of importance x perfomance.

With this index we can understand the value perceived by the customers for our offer and for our

competitor’s. we can understand which company is prefered.

Equilibrium condition: Via/Vib = ?/Pb. Pa is the price that A has to ask in order to reflect the price

of indifference equation.

So you define the price range. The min is competitor’s and the max is the price of indifference (it’s

the maximum level of willingness to pay for my customers).

Which price is the best? It depends on what I want to do. If I chose the minimum, I increase the

value for customers and not for me, if I chose the maximum, I appropriate all the customers value.

Limitations of Fishbein

- We need a competitor

- It’s expensive: the cost is different depending on the way you decide to collect data

(personal interview CAPI most expensive, telephone CATI, web CAWI less expensive,

hybrid approach mix between telephone & web)

- It’s a weighted average, there is a compensation between attributes

- Customers have to express an importance and a performance for each attribute, the

process is forced

- Don’t take into consideration the interactions among attributes

- Limited simulation

Quadrant analysis

The phase of measurement helps us not only to measure the value, but also to find the

improvement areas.

Two dimentions: importance and performance.

High importance; high performance -> Critical point of strength/OK maintain

High importance; low performance -> KO attributes develope/critical weaknesses

Low importance; high performance -> Marginal strength/areas

Low importance; low performance -> Marginal weaknesses/areas

The strategy for marginal areas is to reduce the resources (put the resources in other

quadrants) or try to increase the importance.

Pro di Fishbein:

it’s customer based that means we take into consideration all benefits and costs not

- only functional or explicit but also symbolic and implicit.

Estimate better the value for the customers

- Value base segmentation, targeting and pricing

-

CONJOINT ANALYSIS

It’s the most sophisticated technique to measure the value for customers because

differently from fishbein, it uses statistical methods. I present to the customers different

possible configuration of my offering, I ask them to indicate the preferences and on the

base of the overall evaluation, I calculate the importance and the value perceptions. I

understand statistically which is the importance, the performance and the willingness to

pay of customers for each characteristics of my offer. It’s difficult for firms and easy for

customers.

Process of conjoint analysis (6 fasi):

Step 1. Identification of benefits, attributes and the level of performance of each attribute.

Step 2. Mix benefits, attributes and levels to find all the possible configuration of the offer.

Step 3. Customers evaluate all the different combinations. They have to evaluate the

profiles presented by the firm and not all the attributes as happened in Fishbein.

Step 4. Use regression items to understand why customers evaluated in this way

Step 5. Measure the relative importance of each attribute.

Step 6. Measure of the monetary value and then we can calculate the willingness to pay of

each attribute for each level of them.

Comparison with the limitations of fishbein:

We don’t have a weighted average index

- We don’t need competitors

- We don’t force customers because they’re not asked to give me performance and

- importance; it’s the firm that will calculate them.

Now it’s considered the interaction among the attributes implicitly

-

Limits of conjoint:

- Reduction process of information that customers can give us

- Price is an input and an output: it’s a critical issue because if we apply a wrong price we’ll

get wrong in taking decisions. The solution is estimate the minimum price with cost analysis

of break even point and the maximum price expecially for a new product, is decided by the

management

Hybrid technique: mix between conjoint and fishbein, usefull to understand better the brand

value.

PRICE DIFFERENTIATION

Why differentiate the price? Because it takes profitability. It lets you gain margins from all the

segments you serve applying different prices and capturing all the demand.

Conditions of existence (can I do it?)

- Customers should have different value perceptions that means different willingness to pay

- No ethical implications

- Multicultural implications that is different price perceived differently depending on the

cultures of different countries.

Conditions of management (how can I do it?)

- Customers should be separated so they will not know that they’re paying a different price

for the same product

- Communicate in advance the price differentiation

- Change the product: versioning, bundling, unbundling

VERSIONING

Create different versions of the product, the customers will chose the best version for them (self

segmentation). Conjoint analysis supports versioning because it means change the level of

attributes.

It’s not difficult to implement, customers pay different prices because they want, you have to work

on different value drivers that take to different willingness to pay. (advantages.)

Problems to avoid:

- Overversioning: too many versions for a product, customers become confused (so wtp

decreases) or they become smart and segment the companies (counter segmentation)

- Customers might ask me the version they want and I can produce it just to avoid the risk of

not selling it

BUNDLING

Means you put togheter different products and sell them at one price. Ex. Printer, fax, fotocopy

Advantages:

- Hide the price of each product

- Make stronger the weaker product

- Support cross selling

- Barriers to entry because competitors can enter only with a bundle

- Increase the perceived value

- Exercise positive monopoly

But some customers may not accept the bundle.

UNBUNDLING

Price each component and divide the value proposition

Advantages:

- Show the price

- Support self segmentation and reverse marketing (customers chose what they want, they

create the offer and the price is the sum of every price of the components) -> allow

customization and since that, it’s used by sophisticated customers

- You can enter the market with unbundling and then trade up

- Decrease price perception (psycological effect): you communicate every price, not the total

one

- Usefull in B2B markets because they have a certain and definited budget

Creating value for customers may take to their satisfaction. What is satisfaction?

It’s the delta between expectations and perceptions [the delta between the expected value (what I

expect from a product) and the perceived value (what I perceive by using a product)

]

Three components of satisfaction:

- What a customer expects

- What a company offers

- What a customer perceives of what a company offers

The value created by the firm is coerent with the expectations? And this value is optimally

perceived?

Only a few companies focus on the delta.

3 things can happen:

- Exp = perc OK

- Per < exp -> satisfaction gap

- Per > exp -> customers delight

One of the most important aim for a company is to satisfy customers more than competitors.

The link between satisfaction and loyalty is not so eas