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• Develop for distribution and reclamation a survey targeted for the informational needs of the team
• Assign appropriate and meaningful metrics for ready compilation
• Accumulate and interpret acquired data without bias
Process
• Be careful during survey creation not to inadvertently formulate or include questions that may contain a bias
• Collecting data is important, but the analytical interpretation is essential to the engagement
Tool
Notes/ Implications
1. Please rate the importance of the following attributes in your selection of a retail store by circling the appropriate number. Not At Extremely All Important ImportantPrice 1 2 3 4 5 6 7Product selection 1 2 3 4 5 6 7Operating hours 1 2 3 4 5 6 7Payment methods 1 2 3 4 5 6 7Merchandise quality 1 2 3 4 5 6 7Product Refundability 1 2 3 4 5 6 7Customer service 1 2 3 4 5 6 7Location 1 2 3 4 5 6 716. The following is a list of items that can be purchased from a Target vending machine. Please rate the likelihood that you would purchase these products from the vending machine by circling the appropriate number. Not at All Extremely Likely to Purchase Likely to PurchaseSun block 1 2 3 4 5 6 7Aspirin 1 2 3 4 5 6 7Lip balm 1 2 3 4 5 6 7Hand Lotion 1 2 3 4 5 6 7Mouthwash 1 2 3 4 5 6 7Toothpaste 1 2 3 4 5 6 7Toothbrush 1 2 3 4 5 6 7Soap bar 1 2 3 4 5 6 7Music CD 1 2 3 4 5 6 7CD carrier 1 2 3 4 5 6 7Notebook 1 2 3 4 5 6 7Disposable Camera 1 2 3 4 5 6 7Camera Film 1 2 3 4 5 6 7
Representative questions from a recent survey pertaining to Target vending machines
The Objective: to determine a target market need for vending machines of this nature, as well as consumer receptiveness to vending machines of this nature
• 1-on-1 interviewing technique capable of establishing key consumer associations between product attributes and meaningful values
• By repeatedly asking probing questions of consumers, a value map specific to the relevant provided benefit can be developed that associates attributes to consequences, and consequences to values
• This probing allows greater understanding of consumer behaviors, wants, and needs
• The resulting ladder of perceptual orientations is useful for distinguishing between products in a given product class
Process
• Key Questions: “Why do people not buy my product?” & “Why do people buy my product?”
• It is most beneficial to conduct multiple interviews, with both non-users and product champions to acquire the most valuable insights into consumer motivations and behaviors
• Marketing, specifically advertising efforts should be focused upon consequences (middle ladder levels); i.e. Diet Coke ads should illustrate a consumer gaining the respect of others through physical appearance
Tool
Notes/ Implications
No Caloric Content
Desire to be athletic and attractive
Gain respect of others through
physical appearance
Weight is key determinate of
social acceptance for women
Self-evaluation determined by appearance
SELF ESTEEM SOCIAL ACCEPTANCE
Society values youthful
appearances
Bright, energetic, youthful
appearance
Bottle
Ready-to-transport
containers
Available almost
anywhere
Immediate fulfillment of
need
Reward / Compensation
ACCOMPLISHMENT•Interviewer elicits as many product attributes from the respondent as possible and then probes further…
•Interviewer: You indicated that you enjoy Diet Coke because it doesn’t have calories. Why is this important to you?
•Respondent: I like to stay fit.
•Staying fit is important to you?
•Sure, I like to look good.
•Why is looking good important to you?
•I want to look good; people are judged by their appearance. I care what others think o f me.
•Do you feel that you are being judged?
•Of course! People are constantly judging me; and as a woman it is all about appearance.
•What specifically about appearance do you think is important?
•For women? Weight is the biggest issue.
Hierarchical Value Map: Diet Coke (1 champion/ 2 attributes)Representative interview questions (posed to Diet Coke champion)
• Imagine and define people within specific target segments in an attempt 1) to gain a multi-dimensional view of the customer for whom the client will provide benefit and 2) to gain insight into the unarticulated needs of said customer
• Base profile on certain key ?s: Why does she/he use require this benefit? How does this person see her/himself? What is important to her/him? What are her/his ambitions? Who does she/he want to impress? What is her/his idea of the perfect vacation?
• Repeat this process until customer profiles begin to overlap, and then compile common characteristics/ goals/ values for client’s marketing mix
Process
• The results of this profile-layering have significant importance to the client’s ultimate marketing strategy
Tool
Notes/ Implications
Horacio Castro has just entered the United States illegally at the age of seventeen. Crossing the border with the aid of an established smuggling organization, Mr. Castro is eager to recover his US$3,500 cost of entry into America. Mr. Castro has settled in Chicago to reap the benefits of the city’s large labor market, and to utilize his existing familial ties within the city. Mr. Castro is here primarily to earn money, the vast majority of which will be sent to his rural home in the Durango Province of Mexico. In Mexico, his mother and five younger siblings will use the money to improve the drainage of their small field and purchase those necessities which they cannot provide for themselves. Horacio’s motivations are clear: earn as much money as possible to facilitate a quick return to his Mexican homeland. He has chosen this path as opportunities in Mexico are limited for a man lacking formal education and familial influence. Learning the meat-packing trade from his uncle, Horacio has secured a position in the same plant in which his uncle has labored for twelve years. While his expenses are low (he lives with his uncle’s family free of charge), Horacio recognizes the economic advantages associated with English abilities. His supervisor is a bilingual immigrant from Mexico City, valued for his ability to understand and communicate the motivations of both laborers and management. Horacio wants to emulate this successful supervisor and not his uncle, who having never learned English is still a laborer. In his mind, Horacio struggles with the barriers: he has little educational training, no English-speaking acquaintances, little disposable income with which to procure an education, no knowledge of the available educational opportunities, and little available time with which to take any classes. Horacio is discouraged by the barriers, but he feels there must be a way to learn English.
• Threat of entry is stronger when…entry barriers are low, a sizable pool of entry candidates exists, incumbents are unwilling or unable to contest a newcomer’s entry efforts, and/or newcomers can expect to earn attractive profits
Tool
Notes/ Implications
Structure•Numbers of buyers•Numbers of sellers
•Barriers to entry facing new firms•Product differentiation
•Vertical integration•Diversification
Conduct•Advertising and marketing•Research and development
2.2 Porter’s Five Forces Model2.2 Porter’s Five Forces Model
•Assess strength of each of the five competitive forces (Strong? Moderate? Weak? )
•Explain how each force acts to create competitive pressure. What are the factors that cause each force to be strong or weak?
•Decide whether overall competition (the combined effect of all five competitive forces) is brutal, fierce, strong, normal/moderate, or weak
Process
• Key questions to better understand the ferocity of competition within the industry: Is price competition vigorous? Active efforts to improve quality? Are rivals racing to offer better customer service? Lots of advertising/sales promotions? Active product innovation? Active use of other weapons of rivalry?
Tool
Notes/ Implications
Substitutes: Low to Moderate Increasing competition from hand held/ portable computing devices
Supplier Power: Very High
Intel and Microsoft extract all industry
profits.
Buyer Power: High and RisingLow switching
costs, Less brand loyalty.
Resellers and retailers
have grip on end users
Threat of Entry: Moderate to HighLow capital costs of manufacturing
Relatively easy to assemble PCsSome brand recognition and loyalty
• Define and evaluate the impact of existing and potential forces outside of the industry that may impact the industry and/ or the firm
• With externalities more clearly defined, threats and opportunities can be more easily identified and anticipated
Process
• It is important to evaluate external forces in both the near and far terms, as the client’s survivability and sustainability are key foci for analysis
•Define distinct customer groups with that have one or more problems/ needs which could be solved/ serviced in one or more ways
1.Establish segment variables that yield mutually exclusive and exhaustive segments2.Develop Segment Profiles3.Evaluate Segments for their viability and preliminary “attractiveness”
Process
• Segmentation scheming not only defines potential markets, but also serves as an essential component of the client’s ultimate marketing mix decision
Tool
Notes/ Implications
Determine Which Segmentation Variables to UseDetermine Which Segmentation Variables to Use
•Establish current market make-up in hopes of identifying sectors within which client could best position for success
Process
• Sectoring provides a nice snapshot of customer groups as defined by the existing market; it can also be used to identify “holes” in structure representative of unfulfilled customer groups
•Determine the current value-price orientation prevalent in the industry•Define the customer groups to which major competitors cater (price-sensitive or quality-focused)•Identify areas of the existing value orientation scheme within which client could capture value
Process
• Use the acquired value map to identify holes in the market’s current pricing scheme; where large gaps exist between products on the value line, there exists opportunity for new product introduction
• Complete the matrix as shown, with careful focus upon recommendations arising from the analysis
Process
• This model can at times seem academic in nature, but the recommendations that can be created as a result of completing are often of use; however, avoid specific references to SWOT/TWOS matrices analysis in client communications and deliverables
Tool
Notes/ Implications
Strengths (S)
List internal strengths
Weaknesses (W)
List internal weaknesses
Opportunities (O)
List external opportunities
SO Strategies
Generate strategies here that use strengths to take
• Select the appropriate target customer group by evaluating alignment of the client’s provided benefit and resources/ capabilities with the needs of customers
Objective
• Use sound judgment and offer recommendation based in previous analytical outcomes
Sub-Process
Tools
Match the clients
resources & capabilities
with those of the available
markets
Match the clients
resources & capabilities
with those of the available
markets
Best align the benefit to be
provided with the needs of
customer comprising
each available market
Best align the benefit to be
provided with the needs of
customer comprising
each available market
Identify key aspects of
target market above, on, and
below the surface (size,
income levels, complementary
preferences, etc.)
Identify key aspects of
target market above, on, and
below the surface (size,
income levels, complementary
preferences, etc.)
Select given analysis the
necessary and appropriate
target to maximize impact for
client
Select given analysis the
necessary and appropriate
target to maximize impact for
client
• What benefit is the client providing, and to whom can she/he best provide it?
• Who is the client selling to? Who is the end-consumer?
• Refine judgments as to the market’s receptiveness
Tips & Key ?s• Final determination of target market replete with
• Identify the variables to be used and establish ranges for their likely values
• Use these ranges to calculate the multiple outcomes dependent upon variable levels
• Eliminate those variable combinations, if any, that are unlikely are immaterial
• Use the remaining outcomes to calculate a representative final figure
Process
• Dependent upon the values assigned to each variable, NPV results are positive or negative; in the above example the outcomes are most often positive
• Eliminating unlikely scenarios often helps to clarify the resultant outcomes (ie those values close to zero for each variable are unlikely given P&G’s dominance, and can therefore be eliminated from actual consideration)
Tool
Notes/ Implications
NPV Analysis using 2 variables to evaluate the introduction of a new brand