Chapter 11: Unique Marketing

Issues

Bruce R. Barringer
R.Duane Ireland
Steps firm use to identify their customers
Step 1: Segmenting market
Step 2: Selecting target market
Step 3: Crafting Unique Positioning Strategy
Steps firm use to identify their customers
Step 1: Segmenting the market
• Study the industry ,then identify relevant target market from industry
• Market is segmented on basis of
Product type (products or individuals) like computers, laptops, tablets by Dell, Samsung
Demographics (age, gender, income) like Johnson and Johnson targeting babies from 0-3
years, Dove targeting women, Gillette targeting men
Psychographic (personality , lifestyle, values) like Mountain Dew targeting those who love
adventures, Pepsi targeting cricket enthusiasts
Behaviour (benefits sought, usage rate)
Geography (city, region) like Toyota Hilux
Steps firm use to identify their customers
Market segment should be
• Large enough for firms to earn profits
• Distinct so that its members can be easily identified
• Sizeable enough
• Homogeneity of needs and wants within segment
Steps firm use to identify their customers
Target
Market

Step 2: Selecting an attractive target market

Market
• Niche market is narrow group of customers with similar Segment

interests
• Company must have capabilities to serve its target market

Step 3: Crafting Unique Positioning Strategy

• Company must create positioning. Positioning is a unique place in
customer’s mind by differentiating itself from its competitors through
benefits, products/services
• Example Emirate has positioned itself as world’s best airline because
of its superior service and is clearly different from PIA
Branding
• Brand is set of attributes (positive or negative) associated with
company such as reliable, friendly, fun-loving
Example Pepsi is associated with cricket whereas Coca Cola is
associated with happiness, Disney is associated with fun
• Brand is a promise, guarantee
Example Lays guarantees good quality crisps to its consumers every
time they consume it
• Logo, website is also part of brand
Example Swoosh of Nike, Facebook logo
Branding
Brand management is a program to protect value and image of brand in
consumer’s mind
Brand Equity is a set of assets and liabilities linked to a brand that helps
firm raise its value
Example Coca Cola’s brand name, brand associations of happiness,
customer loyalty form Coca Cola’s brand equity

Brand equity is formed by brand name, perceived quality, brand

associations (e.g. high quality), assets (e.g. patents, trade mark )name
recognition
Marketing Mix
Marketing Mix is set of marketing tools firm uses to produce its desired
response from target market
Marketing Mix is comprised of 4Ps namely
1. Product
2. Price
3. Place
4. Promotion
Marketing Mix
1.Product
• It includes both good and service
• Good can be Dell computer and service includes ride by Bykea, hotel stay
at Marriott

• Core Product It is main product like air conditioner

• Actual product includes name, features, warranty, packaging, benefits
like Dawlance air conditioner, with 1 year warranty, benefits (free
installation), features (60% energy saving)

• Entrepreneur must ensure that core product is right and actual product is
appealing to target market
Marketing Mix
2.Price
• It is the most flexible and only revenue-generating element of marketing
mix
• Price-quality attribution means consumer assumes that higher priced
product is of superior quality and low priced product is of poor quality
• Two Pricing strategies
Cost-based Pricing Value-based Pricing
• Price is determined by incorporating • Price is determined by what consumers are
product’s costs willing to pay for the product (perceived
Advantage of cost-based pricing value)
• It is easy to justify • Company influences consumer’s
Disadvantage of cost-based pricing perception by positioning, branding,
• It is difficult to raise price even if costs rise changing other element of marketing mix
• It is not always easy to estimate costs
• Company thinks what it should receive
rather than what market thinks about the
product
Marketing Mix
3.Place
Place or distribution includes all activities firm takes from place of origin to
customer
Direct selling Firm sells directly to end consumer and no distributor, no
retaileris involved . This process is called ‘disintermediation’
Indirect selling Selling through distributor, retailer to end consumer
 Marketing Mix
3.Place -----Differences between direct selling and indirect selling
Direct Selling Indirect Selling
Advantages Advantages Costs and benefits
of each approach
• Company has complete control of • Company does not need to own
have to be
product from place of origin to end much of the distribution channel
calculated when
user • Company can earn higher profit deciding whether to
• Company can earn higher profit if by not buying its own retail outlet sell directly or
does not keep distributors, retailers or hiring its own sales force indirectly
Disadvantages Disadvantages
• Company has more of its capital tied • Company loses certain control of
in fixed assets such as renting retail its product by selling product to
outlets, maintaining website, distributors, retailers
salesforce
Marketing Mix
4.Promotion
Promotion is set of activities that company takes to communicate benefits of
its product in order to persuade its target market
Promotion can be done through
i) Advertising
ii) Public Relations (PR)
iii) Social Media
iv) Direct marketing
v) Personal selling
vi) Sales Promotion
Marketing Mix
4) Promotion
Advertising
Advertising is done to create awareness about product/service,
communicate its benefits, and to create association
• Advertising is done through newspapers, TV, radio, billboards
• Effective ad is one that is memorable
Disadvantages of advertising
• It is costlier compared to other promotion methods
• People may not be interested in ad
• Message clutter (After watching so many ads, people tune out)
• Advertising is considered less credible(seems as if company is
flaunting itself)
Marketing Mix
4) Promotion
Public Relations
Public Relation are efforts to build and maintain company’s image with
public
Difference between advertising and public relations is advertising is
done by company itself while public relations is done by bloggers,
journalists, press to write say good things about company’s product
who are being paid by company
Trade show is example of public relations
 Marketing Mix
4) Promotion
Social Media
Maintaining brand’s page and channel on Facebook, Instagram,
youtube

Direct Marketing
When brand directly communicates with individual consumers rather
than through mass media such as flyers, phone calls by Telenor, Ufone,
postcards by Kitkat
 Marketing Mix
4) Promotion
Personal Selling
Face to face selling when sales person tries to convince
buyer to purchase a product Example in retail outlets,
car showrooms

Sales Promotion
Business uses temporary scheme to increase demand Example Buy 1
Get 1 Free, Free Return ticket, lucky draw, 50% Off, coupons