Business and Career
Development
Creating Value through Marketing
C1:Introduction: Why Marketing Matters?
C1:Introduction: Definition of Marketing
“Marketing management is the art and science
of choosing target markets and getting, keeping,
and growing customers through creating,
delivering, and communicating superior
customer value”
- Kotler & Keller (Marketing Management)
C1:Introduction: Marketing management
tasks
• Capturing marketing insights
• A reliable marketing information system to monitor the marketing
environment, and dependable marketing research system to assist
decision-making
• Connecting with customers
• Offering value for its chosen target markets and developing strong
profitable long term relationships
• Communicating value
• Integrating mass communications (advertising sales promotions,
events and PR) and personal communications (direct and interactive
marketing) for maximum impact
• Building strong brands
• Competitively positioning brands to build brand equity
C1:Introduction: Change is the only
Constant
“In the past decade, what marketers do to engage customers
has changed almost beyond recognition.
With the possible exception of information technology, we can’t
think of another discipline that has evolved so quickly.
Tools and strategies that were cutting-edge just a few years ago
are fast becoming obsolete, and new approaches are appearing
every day”
- de Swaan Arons, M., van den Driest, F., & Weed, K. (2014). The
Ultimate Marketing Machine. Harvard Business Review.
C1:Capturing Market Insight: Purpose –
the 4P’s
To control four variables — the “marketing mix”— for
approaching to customers in attempting to satisfy their
desires
Price
Product
How much
What are we
we are
selling?
selling it for?
Place Promotion
Where and How to
How we will communicate
sell it? ?
C1:Capturing Market Insight: Market
Research
1. Define the problem and set the research
objective
2. Develop the research design for collecting
data
3. Collect the data
4. Analyze and interpret the data
5. Report the research findings
C1:Capturing Market Insight: Gathering
Information from Market Research - 3CP
• Customer
• Who is the customer? What does each customer segment want? What
price is each segment willing to pay? Where are our customers located?
Distribution channel preference?
• Company
• Who are our suppliers? What are our channels of distribution?
• Competitor
• Who are the competitors? How big are they? Where are they? Do they
serve the same market as you? Which products do they sell? At what
price? What distribution channels do they use? Do they have new
products?
• Product
• Do current products meet customers’ needs? Do new products need to
be developed?
C1:Capturing Market Insight: Situation
Analysis from Market Research– The 5C’s
• Potential customers whose needs can be
Customers fulfilled with company offerings
• The company, its goals, core competencies and
Company strategic assets required to develop offerings to
serve these customers
• Potential collaborators who are likely to be working
Collaborators with the company on these offerings
• Current and potential competitors with similar
Competitors offerings targeting the same buyers
• The economic, technological, socio-cultural,
Context regulatory and physical context in which the company
operates
C1:Capturing Market Insight: CRM
• Customer relationship management (CRM) is an
approach to managing a company's interaction with
current and potential future customers (Wiki)
• People thinks CRM must be a software system like
Salesforce for capturing customer information
• Great CRM can done without any software system!!!
• Ex: a customer information record kept by a beautician
• CRM success depends on appropriate
understanding of customer behaviour
C2:Connecting with Customers: STP
Model
C2:Connecting with Customers:
Segmentation Criteria
•Used to determine the relative ease of identifying the segments. Which
Measurability segments are more discernable and easier to identify as to who they are?
•Used to determine the differences in accessing and communicating
Accessibility with the segments. Which segments utilize which media?
•Used to determine the relative potentials across the segments. Which
Substantiality segments possess the greater potential. Which segments would provide the
greatest rate of return?
•Used to determine the differences in responsiveness across the segments in
Unique Responsiveness terms of what might be marketed. Which segments would respond more
favorably to what if offered?
•Used to determine the relative degree of the organization's ability to effectively
Actionable orchestrate suitable marketing programs across the segments. Which segments
could the organization develop more effective marketing programs for?
C2:Connecting with Customers:
Segmentation Analysis Matrix Example
Criteria Segment Segment Segment Segment
Variable/s 1 2 3 N
Measurability
Demographics
Accessibility
Media types
Substantiality
Size, Income, Costs
Unique Responsiveness
Psychological, Social,
Behavioral
Actionable
Current marketing
C2:Connecting with Customer: Targeting
• Analyze potential and commercial attractiveness of each
segments
• Based the attractiveness and compatibility, select one or
more segments as the Target Market
Market • Degree to which a particular
attractiven market enables the company to
achieve its strategic goals
ess
Market • The company’s ability to serve
this market by creating
compatibili superior value to its target
ty customers and collaborators
C2:Connecting with Customer:
Positioning
• Creating a distinct image of your offering in the customer’s
mind.
• e.g., Volvo = safety, Toyota = reliability, BMW = the driving experience
• Three basic ways to emphasize benefits -
• Single benefit approach – the single attribute that will provide
customers with the most compelling reason to buy
• Multi-benefit approach – two or more primary attributes
• Holistic approach – overall performance of an offering
• Three types of positioning strategies -
• Functional benefits e.g., Visa = worldwide acceptance
• Monetary benefits e.g., [Link] = monetary value
• Psychological benefits (an offering’s image) e.g., Montblanc = luxury,
exclusivity and prestige
C2:Connecting with Customers: Smart
Car
Smal
SUV l Car Small
SUV Car
Comp
Regul
act
ar Car Regular Compac
car
Car t car
Econ
omy
Saf
ety
Fashion
C3:Communicating Value: Customer
Lifetime Value (CLV) and Customer
Equity
• Customer Lifetime Value (CLV) is the present value of the
future (net) cash flows associated with the customer
• e.g., if a newspaper subscriber will pay C amount of (net) cash for
next n years and the discount rate is i, then the CLV will be total of
the discounted cash flow for next n years.
• Customer Equity is the sum of the customer lifetime values
(CLV) across the entire customer base
• Q: Does the value of a firm (if you want to buy it) is same
as it’s Customer Equity?
C3:Communicating Value: Customer
Acquisition based on CLV
• Acquisition Strategies –
• Selective acquisition - Acquire customers with a specific
profile, e.g., higher retention and development potential,
which lead to higher CLV
• Broad Acquisition - Bring in many (heterogeneous)
customers, and utilize a selection process (natural and/or
active) to take care of CLV issues
• Acquisition Tactics –
• Direct approach - Identify and approach specific targeted
customers
• Indirect approach – Customers influenced by existing
customers (e.g., word of mouth, referral, network effect,
i.e., product value increases as more customer adopts it)
or mass marketing
C3:Communicating Value: Marketing
Channel
Digital Marketing Techniques:
• lead
• Customer
generation • Social Media Presence- Social media presence
• Telemarketin profiling
• Face to face on Facebook, Twitter, LinkedIn, etc., Blogging,
g User generated content (reviews)
• Search Engine Optimization (SEO) - Ensure all
Broad Selective your pages are crawled by search engines,
Direct Direct your website is indexed for the “right” kinds of
keywords and achieve high ranking
• Personalize Your Website – provide customized
recommendation using of data analytics
Broad Selective
Indirect Indirect • Digital Advertising - Search Engine Marketing,
• Word of Display Ads (e.g. banner ads), Social Ads (e.g.,
mouth • Referral
Facebook timeline ads)
• Mass program
marketing • Public Relations (PR) – Unpaid editorial
coverage in media outlet like newspaper, TV,
blog etc.
C3:Communicating Value: Omni-channel
Marketing
• Omni-channel marketing is to take a broader perspective
on channels and how shoppers are influenced and move
through channels (using interchangeably and seamlessly)
in their search and buying process due to the advent of the
online channel and new additional digital channels such as
mobile apps and social media
• As the retailing industry evolves towards a seamless “omni-
channel retailing” experience, the distinctions between
physical and online will vanish turning the world into a
“showroom without walls”
C3:Communicating Value: It’s the
customer, that’s the Omni-channel
• The most successful brands with omni-channel marketing
are those that think about outcomes, not channels
• Use data to understand consumer behaviour across all
interactions so you reach customers with the right
information in the channel where it has the biggest impact
• But let the customer to choose which channel is most
convenient for them
• Channels typically considered only for prospecting, or only
for loyalty building, should also be available to customers
at all times, because customers don't think in terms of
touchpoints, but looks for the service or product she needs
C3:Communicating Value: Starbucks
Reward App
• The Starbucks rewards app does an excellent job in
providing a seamless user experience across all
channels
• Customers have the option of checking and reloading
their Starbucks card balance through their phone, the
Starbucks website, or when they’re at the store
• Any balance or profile changes are also updated in
real-time, across all channels, letting users stay in-
the-know no matter where they are or what device
they’re using
• Plus, any earned rewards are automatically reflected
in the account without any action on the user’s part
• When it comes to payments, people can either pay
with their physical rewards card or using their phone,
and the balance will automatically be updated online
and in the app.
C4:Building Strong Brands: Product vs
Brand
• A Product is something we offer to a market to satisfy a
need or want. It may be a physical good, a service, a retail
outlet, a person, an organization, a place, or even an idea
• A Brand is a name, term, sign, symbol, or design, or a
combination of them, intended to identify the goods or
services and to differentiate them from those of
competitors.
• Product is tangible and rational whilst Brand is intangible
and psychological
• A brand is more than a product, as it can have dimensions
that differentiate it in some way from other products
designed to satisfy the same need (so if you don’t have
much differentiated product still brand differentiation can
C4:Building Strong Brands: Function of
Brand
• For Customers
• Identify the source or maker
• Reduce search cost and simplify decision making
• Signal quality of the product
• Reduce social and psychological risk
• For Companies
• Represent enormously valuable pieces of legal property, capable of
influencing consumer behavior, and providing the security of
sustained future revenues
C4:Building Strong Brands: Brand
Elements and Branding Strategy
• Brand names, URLs, logos, symbols, characters, spokespeople,
slogans, jingles, packages, signage etc.
• Criteria for choosing brand elements
• Memorability - memorable and attention-getting
• Meaningfulness - provide descriptive or persuasive content
• Likeability - is it aesthetically appealing
• Transferability - extent to which it adds to brand equity of new products
• Adaptability - ability to be updated to remain contemporary
• Protectability - can be legally protected and defended
• Branding Strategy - which brand elements can be applied to
which products depends on consistency, credibility and clarity it
provides to improve consumer understanding and to
communicate similarity and differences between individual
products
C4:Building Strong Brands: Brand
Development Stages
C4: Building Strong Brands: Purpose
Branding – Discovering Customer Job to
be Done
• Customer don’t bye a product or service. When people find
themselves needing to get a job done, they essentially hire products
to do that job for them. e.g., “People don’t want to buy a quarter-inch
drill. They want a quarter-inch hole!”
• If a marketer can understand the job, design a product and
associated experiences in purchase and use to do that job, and
deliver it in a way that reinforces its intended use, then when
customers find themselves needing to get that job done, they will
hire that product
• A Purpose Brand is the brand of a product that is tightly associated
with the job for which it is meant to be hired for. So, when consumers
discover the job they need to do, a branded product will exist that is
perfectly and unambiguously suited to do it
• Brand equity can be destroyed when marketers don’t tie the brand to
C4:Building Strong Brand: Chotukool
• The idea to address the basic refrigeration needs
of rural families in India
• The "job" is that people needed an affordable way
to keep milk, vegetables and leftovers cool for a
day or two—both at home or away
• This job is urgent in a country where a third of all
food is lost to spoilage
• Godrej developed “ChotuKool” or “Little Cool” for
this Job to be Done.
• The purpose branding “ChotuKool” is tightly
associated with the job for which it is meant to be
hired for
C5:Case Discussion: Social Media
Marketing
The Sanitation Crisis and Social Media: Sanergy in Kenya
Questions:
1. Would Kenya’s cultural values of trust and personal
contact translate well to social media?
2. Would companies be able to build sufficient trust with
prospects through social media or would its use be limited
to transactional relationships such as customer service?
3. What role might social media play in luring new funders
and getting them to open their checkbooks?
