Recap Market Targeting Selecting Target Market Segments Target

Recap

Market Targeting Selecting Target Market Segments • Target market consists of a set of buyers who share common needs or characteristics that the company decides to serve

Market Targeting Evaluating Market Segments. • Segment size and growth – Can you meet the growth challenges – Competition • Segment structural attractiveness – – Competitors Substitute products Power of buyers Power of supplier • Company objectives and resources – Strategic fit

Market Targeting Target Marketing Strategies

Differentiation and Positioning Choosing a Differentiation and Positioning Strategy • Identifying a set of possible competitive advantages to build a position • Choosing the right competitive advantages • Selecting an overall positioning strategy • Developing a positioning statement

Differentiation and Positioning Identifying Possible Value Differences and Competitive Advantages Competitive advantage is an advantage over competitors gained by offering consumers greater value, either through lower prices or by providing more benefits that justify higher prices

Differentiation and Positioning Choosing a Differentiation and Positioning Strategy • Identifying a set of possible competitive advantages to build a position by providing superior value from: Product differentiation Service differentiation Channel differentiation People differentiation Image differentiation

Differentiation and Positioning Selecting an Overall Positioning Strategy Value proposition is the full mix of benefits upon which a brand is positioned

Differentiation and Positioning Selecting an Overall Positioning Strategy • Positioning statement – Target market – Brand – Point of difference

Differentiation and Positioning Selecting an Overall Positioning Strategy • Choosing and delivering the chosen position – Marketing Mix efforts must support – Deliver what you promise

Products, Services, and Brands: Building Customer Value Lecture 13

Product, Services, and Branding Strategy Topic Outline • • What Is a Product? Product and Services Decisions Branding Strategy: Building Strong Brands Services Marketing

What Is a Product? Products, Services, and Experiences • Product is anything that can be offered in a market for attention, acquisition, use, or consumption that might satisfy a need or want

What Is a Product? Products, Services, and Experiences • Broadly defined, “products” also include service, events, persons , places , organizations , ideas , or mixes of these.

What Is a Product? Products , services and experiences • Product is a key element in the overall marketing offering, marketing mix planning begins with building an offering that brings value to target customers. • Basis upon which the company builds profitable customer relationships

What Is a Product? Products , services and experiences • The offer may consist of a pure tangible good such as soap, toothpaste or salt. • At the other extreme are the pure services for which the offer consists primarily of a service.

What Is a Product? Products , services and experiences How to create difference? • Experiences represent what buying the product or service will do for the customer

What Is a Product? Levels of Product and Services Levels of product • The most basic level is the core customer value, which addresses the question “ what is the buyer really buying ? “

What Is a Product? Levels of Product and Services • At the second level, product planners must turn the core benefits into an actual product, – features, design, a quality level or a brand name and packaging.

What Is a Product? Levels of Product and Services • Finally , an augmented product around the core benefit and actual product by offering additional consumer services and benefits.

What Is a Product? Levels of Product and Services

What Is a Product? Product and Service Classifications Consumer products Industrial products

What Is a Product? Product and Service Classifications • Consumer products are products and services for personal consumption • Classified by how consumers buy them – Convenience products – Shopping products – Specialty products – Unsought products

What Is a Product? Product and Service Classifications • Convenience products are consumer products and services that the customer usually buys frequently, immediately, and with a minimum comparison and buying effort • Newspapers • Candy • Fast food • They are usually low priced, and marketers place them in many locations to make them available when consumers need them

What Is a Product? Product and Service Classifications • Shopping products are consumer products and services that the customer compares carefully on suitability, quality, price, and style • Furniture • Cars • Shopping products marketers distribute their products through fewer outlets but provide deeper sales support to help customers in their comparison efforts.

What Is a Product? Product and Service Classifications • Specialty products are consumer products and services with unique characteristics or brand identification for which a significant group of buyers is willing to make a special purchase effort • Medical services • Designer clothes • Buyers normally don’t compare specialty products, they invest only the time needed to reach dealers carrying the wanted products

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What Is a Product? Product and Service Classifications • Unsought products are consumer products that the consumer does not know about or knows about but does not normally think of buying • Life insurance • Funeral services • Blood donations • Unsought products require a lot of advertising, personal selling, and other marketing efforts

What Is a Product? Product and Service Classifications • Industrial products are products purchased for further processing or for use in conducting a business • Classified by the purpose for which the product is purchased – Materials and parts – Capital – Supplies and services

What Is a Product? Product and Service Classifications • Capital items are industrial products that aid in the buyer’s production or operations • Materials and parts include raw materials and manufactured materials and parts usually sold directly to industrial users • Supplies and services include operating supplies, repair and maintenance items, and business services

What Is a Product? Organizations, Persons, Places, and Ideas • Organization marketing consists of activities undertaken to create, maintain, or change attitudes and behavior of target consumers toward an organization • Both profit and non profit organization practice organization marketing

What Is a Product? Organizations, Persons, Places, and Ideas • Person marketing consists of activities undertaken to create, maintain, or change attitudes and behavior of target consumers toward particular person. • People use person marketing to build their reputation

What Is a Product Organizations, Persons, Places, and Ideas • • Place marketing consists of activities undertaken to create, maintain, or change attitudes and behavior of target consumers toward particular places. E. g. Tourism summit Social marketing is the use of commercial marketing concepts and tools in programs designed to influence individuals’ behavior to improve their wellbeing and that of society E. g. TB advertisements

What Is a Product Organizations, Persons, Places, and Ideas • Social marketing programs include public health campaigns to reduce smoking , alcoholism, drug abuse, and obesity • Other social marketing efforts include environmental campaign to promote clean air and conservation • Still others address issues such as family planning and human rights and racial equality

Product and Service Decisions • Three Levels – Individual Product Decisions – Product Line decisions – Product decisions

Product and Service Decisions Individual Product and Service Decisions

Product and Service Decisions Individual Product and Service Decisions Product attributes are the benefits of the product or service • Quality • Features • Style and design

Product and Service Decisions Individual Product and Service Decisions • Quality has a direct impact on product or service performance, thus , its closely linked to customer value and satisfaction. • Quality can be defined as “ freedom from defects”

Product and Service Decisions Individual Product and Service Decisions Product quality includes level and consistency • Quality level is the level of quality that supports the product’s positioning • Conformance quality is the product’s freedom from defects and consistency in delivering a targeted level of performance

Product and Service Decisions Individual Product and Service Decisions • Product features are a competitive tool for differentiating a product from competitors’ products • Product features are assessed based on the value to the customer versus the cost to the company • Strip down model vs fully loaded

Product and Service Decisions Individual Product and Service Decisions Style describes the appearance of the product Design contributes to a product’s usefulness as well as to its looks. It goes to the very heart of a product