MGT-519 STRATEGIC MARKETING AAMER SIDDIQI 1. LECTURE 31 2.

MGT-519 STRATEGIC MARKETING

AAMER SIDDIQI

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LECTURE 31

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REVISION

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REVISION - BRANDINGBrands much more than just logos or names. They are the culmination of a user’s total experience with the product … over many years. That experience is made of a multitude of good, neutral and bad encounters such as the way a product performs, an advertising message, a press report, a telephone call, or a rapport with a sales assistant.•Branding in business terms lies with the need for groups and individuals to have an identity that was easily recognisable by others •With the expansion of world trade, brands became a necessity as a mark of quality and assurance.

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BRANDING• Manufacturers who could provide consistent quality goods who,

realised that they could attract more customers and charge higher prices if they could “badge” their products making them easily recognisable.

• A strong brand brings with it a wealth of quality, value and high performance cues and can even be an intrinsic part of its customers’ lifestyles

• Branding is now a strategy used ‘to differentiate products and companies, and to build economic value for both the consumer and the brand owner’

• Brand identity is designed to represent the brand’s values and signal them to potential customers. Helps the customers to form a brand image in their minds.

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BRANDING• Customer satisfaction is the heart of success • A result of increased competition making it harder to attract and

keep customers.• Brands are denoted by their unique names, logos, packaging and

associated images. This makes up their brand identity.• Branded products have distinct advantages over non-branded ones• Akin to differentiated versus generic product positioning• A strong brand is a key to commercial success by providing

Advantages: high brand equity, increased product awareness levels, the ability to charge a premium price Etc

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BRANDING• The basis of brand equity lies in the relationship that develops

between a consumer and the company selling the products or services under the brand name.

• Thus a well known brand adds value to a product both from the customer perspective and from the company’s.

• Brand equity of Coca-Cola is over seventy percent of their asset value – far in excess of their tangible assets

• Product and packaging design play key roles as well by making the product more visible and reinforcing the brand’s values

• A good brand name helps a firm achieve a premium price for its products.

• A branded product simplifies shopping by assisting with the customer’s product adoption process

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BRANDING• If the marketing communications have worked well, then the

potential customer will already have built up a set of associations with the brand

• The strength of the customer’s relationship with a brand is central to that brand’s growth.

• The relationship is normally between the customer and the brand. not between the customer and the brand’s owner

• The importance of this brand relationship has prompted companies to develop various relationship-building activities

• Members of brand communities can be the brand’s greatest critics as well as its greatest fans

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BRANDING• A brand that has been bought before and found to be satisfactory

reduces these risks and so people are more likely to buy that trusted brand again

• A good experience of a brand results in a happy customer who continues to purchase and Spread positive “word-of-mouth”

• Retailers therefore have a great deal of buying power

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REVISION - THE MARKETING MIX• Identifies company performance actions which influence

consumer decision to purchase goods or services • Summated into four elements: product , price, place and promotion

• The offer you make to you customer can be altered by varying the mix elements

• Differences when it comes to services marketing versus the marketing of tangible products

• Additional ‘4Ps’ of the ‘7P’ extended marketing mix consist of • People, Physical evidence and Process• Service marketing also includes the concept of ‘servicescape’ • Refers to the aesthetic appearance of the business from the • Outside and Inside

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SERVICE MARKETING• Service Marketing has been rapidly gaining ground in the overall

spectrum of marketing • The shift to services means a shift away from customer decisions

based on tangible FABs to intangible service elements.• An emphasis on quality of experience and feedback

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• A price is what is given in a commercial exchange in return for a good or service.

• A price is what a business charges, anda cost is what a business pays

• “Price is the marketing-mix element that produces revenue; the others produce costs.”

• Pricing is the marketing activityinvolved with capturing, or “harvesting,” the value created by the other types of marketing activities

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PRICE

PRICING ISSUES • Pricing issues fall into one of the following three categories: (1)buyer–seller interactivity (2)price structure(3)price format

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PLACE• Definition: Place in the marketing mix refers to the channel, or the

route, through which goods move from the source to the final user. Place could be the intermediaries, distributors, wholesalers and retailers

• In other words, how and where the consumer buys the product or service.

• Players that make up the 'place' aspect of the marketing mix: -– Retailers, – Wholesalers, – Distributors, – Warehouses – The Internet

• All of these move, stock and sell goods

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• RETAILERS: The final step in the chain- deal directly with customer. Focused on consumer markets

• WHOLESALERS makes money buying at a lower price from the producer and adding a profit margin onto the price paid by the retailer

• DISTRIBUTORS serve as a local sales point. Specialise in a particular industry

• AGENT: Specialist type of distributor, Does not hold stock• A business faces a choice of using direct (Channels where a

producer and consumer deal directly with each other without the involvement of an intermediary ) or indirect (Involves the use of intermediary between the producer and consumer) channels

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DIRECT CHANNELS• Increasingly popular• Various methods• Direct mailing• E-commerce• Telemarketing

• FACTORS TO CONSIDER• Nature of the product• The market• The business

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PRODUCT – BUNDLE OF BENEFITSMarketing is not about providing products or services it is essentially about providing changing benefits to the changing needs and demands of the customer•FORMS OF PRODUCT

– Convenience goods– Shopping goods– Specialty goods

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PRODUCT• Product line(s) refers to the assortment of similar things that the

firm holds. • Product mix describes the combination of different product lines

that the firm holds• Focused or narrow product line • Wide product mix a large assortment of goods that are thought

to be related • Depth refers to the variety that is offered within each product

line.

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NEW PRODUCT DEVELOPMENT• New product strategy development: Different firms will have different

strategies on how to approach new products.• Idea generation. Firms solicit ideas as to new products it can make• Screening and evaluation: Some products that after some analysis are

clearly not feasible • Business analysis. Ideas are to more rigorous analysis. • Profit projections, risks, market size, and competitive response are

considered. • Development: The product is designed and manufacturing facilities are

planned.• Market testing: Firms will “test” a product in one region to see if it will

sell in reality before it is released• Commercialization: Facilities to manufacture the product on a larger

scale are now put into operation19

PRODUCT DECISIONS• Product design:• Product quality:• Product features: • Product branding

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PRODUCT LIFE CYCLE• PRODUCT LIFE CYCLE progresses through a sequence of stages from

– Introduction– Growth– Maturity & – Decline

• Every product has a life periodMost companies understandthe different product life cycle stages

• Companies invest heavily in new product development in order to make sure that their businesses continue to grow.

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PRODUCT LIFE CYCLE• Introduction Stage• The firms seeks to build product awareness and develop a market

for the product. • Growth Stage – the firm seeks to build brand preference• Increase market share• Maturity Stage – strong demand in sales diminished• Competition may appear with similar products• Primary objective is to defend market share & maximize profits• Decline Stage –Eventually, the market for a product will start to

shrink in the decline stage

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IMPORTANCE OF PLC• The idea of the product life cycle is an important principle

manufacturers need to understand in order to make a profit and stay in business.

• The key to successful manufacturing is not just understanding this life cycle but also proactively managing products throughout their lifetime

• Applying the appropriate resources and sales and marketing strategies depending on what stage products are at in the cycle.

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END OF REVISIONPART # 1

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THANKYOU

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