ENTREP 1:

ENTREPRENEU
RIAL
MANAGEMENT
Chapter 5: Opportunity seizing: Marketing, VOC and Pain Points
Opportunity Seizing

Identify the Target Market

The more focused the target market definition, the
better for the marketing communication group to know
who to send messages to and for the sales force to know
who to approach.
Opportunity Seizing

Creating a Compelling Message

Positioning is communicating the overall positive
impression of a brand, relative to competition. There are
three points to remember in product or service positioning
– it must be:
▸ Relevant
▸ Unique
Opportunity Seizing

Positioning is the act of designing the company’s

offering and image to occupy a distinctive place in the
target market’s mind. The end result of positioning is
the successful creation of a market-focused value
proposition, a cogent reason why the target market
should buy the product.
Opportunity Seizing

Being relevant is about identifying and solving pain

points. The pain points can be actual (unsatisfied
performance) or latent (creating a higher level of
satisfaction)

Being unique is about creating distinctive value

compelling enough to attract customers to buy
continuously.
Marketing: Mindset, Market and
Message
Value Proposition
Among the elements of the marketing mix, the first
elements to be assembled is always the value
proposition, or the product vis-à-vis price, as these two
are inseparable.
The entrepreneur needs to decide if the value
proposition will be superior, parity, inferior or even
different to what is available in the marketplace.
What is Voice of Customers (VOC)?
What is VOC?

Voice of Customers (VOC)

It is a research process used to capture the changing
needs of consumers (end users) and customers
(channels). A key to voice of customers is identifying and
understanding pain points, barriers and its root causes to
trigger greater demand in an industry.
Pain Point Process

Pain Points
Pain points are the combination of a consumer’s
dislikes as well as his or her wish list since the latter might
not be suggested unless there is some dissatisfaction.
Pain Point Process

Pain Point Process

Step 1 – Pain Hunting

Step 2 – Pain Points Identification
Step 3 – Pain Points Understanding
Step 4 – Pain Points Healing
Pain Point Process

Step 1- Pain Hunting

Entrepreneurs must choose a specific group of
people as their target market. Whether customer or
noncustomer group, the group must behave in a
homogenous way like having common traits and seeking
common benefits.
Pain Point Process

Step 2- Pain Points Identification

To know consumer pain points, the target market can
be asked what they dislike about a particular brand or
product. These dislikes can be plotted on a moment-of-
truth map that captures the consumer buying journey.
Note the best time to ask is when the consumers are
conscious of these pain points so get as close to the
customers when they are using the product or
encountering your service.
Pain Point Process

Step 3- Pain Points Understanding

Not all pain points have some level of importance.
Entrepreneurs must understand the frequency, and depth
then choose the key pain points priorities that must be
solved due to relative higher impact that can be felt by the
customers. This where critical processes need to be
identified and prioritized based on which can solve more of
customer’s problems or create greater value for the
customers.
Pain Point Process

Step 4- Pain Healing

It is important for entrepreneurs to have empathy and
not just understand pain points, but also accept that
change is needed, and that speed of change by external
factors may leave them obsolete in their industry.
MARKETING MIX
Marketing Mix

Marketing Mix , more popularly known as the 4 Ps of

marketing is a set of controllable and inter-related
variables composed of product, place, price and
promotions that the company assembles to satisfy a
target group.
PRODUCT
Marketing Mix

Product/Service
The first of the Four Ps of marketing is product. A product is
the tangible good or the intangible service that the enterprise
offers to its customers in order to satisfy their needs and to
produce their expected results. Some products have built up
so much loyalty to the point that their brand names have
become their best selling proposition.
PRODUCT CLASSIFICATION
Product Classification

A product can be classified as tangible or intangible.

A tangible product is a physical object that can be

perceived by touch such as a building, vehicle, or gadget.
Most goods are tangible products.
Goods/ Goods-services continuum

 Goods – Tangible products customers can see, hear,

smell, taste, or touch.

 Goods-services continuum – spectrum along which

goods and services fall according to their attributes,
from pure good to pure service.
Product Classification

An intangible product is a product that can only be perceived

indirectly such as an insurance policy. Intangible data
products can further be classified into virtual digital goods
(“VDG”), which are virtually located on a computer OS and
accessible to users as conventional file types, such as JPG
and MP3 files.

Virtual digital goods require further application processing or

transformational work by programmers, so their use may be
subject to license and or rights of digital transfer.
3 Types of Product

 Durables – products which have long interval between

repeat purchases because of their long-lasting nature.

 Non-durables – Products which have stronger repeat

purchases because they are consumable.

 Services – Products which are essentially intangible

because there are no physical items involved.
THE 3 LEVEL OF
PRODUCT
3 Levels of Product

 Formal Products – is the physical or tangible product;

It is reflected in the quality, features, brand name,
styling, and packaging.

 Augmented Products – are the “extras” built-in to the

product.

 Core Products – is the generic benefit that each

product gives.
The 3 Levels of Product

CORE

Augmented

Formal
PRICE
Marketing Mix

Price
Price determinations will impact profit margins, supply,
demand and marketing strategy. Price is the amount
of money that your customers have to pay in exchange
for your product or service.
PRICING OBJECTIVES
Pricing Objectives
Four major pricing objectives are:
✔ Survival
✔ Maximum current profit
✔ Maximum market share
✔ Product-quality leadership.
Pricing Objectives

Survival
Survival is one of the most fundamental pricing objectives.
This generally means temporarily setting prices low, even
at times below costs, in order to attract more sales.
As long as prices cover variable costs and some fixed
costs, the company stays in business. Survival is a short-
run objective; in the long run, the firm must learn how to
add value or face extinction.
Pricing Objectives

Maximum current profit

Many entrepreneurs try to set a price that will maximize
current profits. They estimate the demand and costs
associated with alternative prices and choose the price
that produces maximum current profit, cash flow, or rate of
return on investment.
In emphasizing current performance, the company may
sacrifice long-run performance by ignoring the effects of
other marketing variables, competitors’ reactions, and
legal restraints on price.
Pricing Objectives

Maximum market share

Some businesses want to maximize their market share.
They believe a higher sales volume will lead to lower unit
costs and higher long-run profit. They set the lowest price,
assuming the market is price sensitive.
An organization can increase its market share even if
sales for the total industry are flat or decreasing.
Pricing Objectives

Product-Quality leadership
A business might aim to be the product-quality leader in
the market. Many brands strive to be “affordable
luxuries”—products or services characterized by high
levels of perceived quality, taste, and status with a price
just high enough not to be out of consumers’ reach.
TYPES OF PRICING STRATEGIES
Types of Pricing Strategies

Premium pricing
Premium pricing, also called image pricing or prestige
pricing, is a pricing strategy of marking the price of the
product higher than the industry standards/competitors’
products. The idea is to encourage a perception among
the buyers that the product has a more utility or a higher
value when compared to competitors’ products just
because it is sold at a premium price.
Types of Pricing Strategies

Penetration Pricing
Penetration pricing is a pricing strategy where the price of
the product is initially kept lower than the competitors’
products to gain most of the market share and to trigger
word of mouth marketing. Once customers become loyal
and the brand achieves a strong market penetration,
marketers increase the prices to a point where they get
optimum profits without 0 much loss of customers.
Types of Pricing Strategies

Price Skimming
Price Skimming is a strategy of setting a relatively high
introductory price of the product when the product is new
and unique and the market has fewer competitors. The
idea is to maximize the profits on early adopters before
competitors enter the market and make the product more
price sensitive. The strategy got its name from successive
skimming of layers of cream or the customer segments as
the prices are lowered over time.
When Apple dropped the iPhone’s price from
$600 to $400 only two months after its
introduction, public outcry caused the firm to
give initial buyers a $100 credit toward future
Apple purchases.
Types of Pricing Strategies

Psychological Pricing
Psychological pricing refers to the psychological pricing
strategies marketers use to make customers buy the
products, triggered by emotions rather than logic. Such
strategies come in the form of:
▪ Charm pricing
▪ Prestige pricing
▪ BOGOF
Types of Pricing Strategies

❖ Charm Pricing:
This involves reducing the price by a minimal amount (say
1 cent) which makes the customer perceive the price to be
less.
Types of Pricing Strategies

❖ Prestige Pricing:
This involves rounding off and setting a higher price for
premium and exclusive products as rounded figures are
easily processed and are preferred in such cases.
Types of Pricing Strategies

❖ BOGOF:
Buy one, get one free offers trigger the greed among the
customers as they get two products for the price of one.
This strategy is often used to clear up the stock or
increase the volume of sales
Types of Pricing Strategies

Freemium
Freemium is an Internet-based pricing strategy where
basic services are provided free of charge but charges are
levied on additional premium features. The freemium
strategy is different from premium with free samples
strategy as you don’t pay anything to utilize the free
services provided under the freemium business model.
Types of Pricing Strategies

Predatory Pricing
Predatory pricing, or below the cost pricing, is an aggressive
pricing strategy of setting the prices low to a point where the
offering is not even profitable, just in an attempt to eliminate
the competition and get the most market share. An ongoing
price war among the competitors may lead to one adopting a
predatory pricing strategy to make the competitor exit the
arena. Predatory pricing is illegal in many countries under the
antitrust laws and competition acts as it acts as a barrier to
healthy competition and leads to businesses enjoying a
monopoly.
PLACE
Marketing Mix

Place
Place or placement has to do with how the product will
be provided to the customer. Place involves decisions
concerning distribution channels to be used, the
location of outlets, methods of transportation and
inventory levels held.
INITIAL LOCATION SCREENING
Initial Location Screening

Image and Location Conditions

This refers to the physical look of locations, sanitary
conditions, crime and safety levels, etc. The reputation of a
location is also important.
Initial Location Screening

Exact Fit to Target Customers

Is the location traffic generally composed of your target
customers?
Initial Location Screening

Future Area Development

A certain location might not have the most customers or the
best economics in the short term, but it might become a
central business hub within the next five years.
PROMOTION
Marketing Mix

Promotion
The marketing communication strategies and
techniques all fall under the promotion heading. These
may include advertising, sales promotions, special
offers and public relations. Whatever the channel
used, it is necessary for it to be suitable for the
product, the price, the place and the end user it is
being marketed to.
ELEMENTS OF THE
PROMOTIONAL MIX
Elements of the Promotional Mix

Promotional Mix
Subset of the marketing mix in which marketers attempt to
achieve the optimal blending of the elements of personal
and nonpersonal selling to achieve promotional objectives.
Elements of the Promotional Mix

PERSONAL SELLING
Interpersonal influence process involving a seller’s
promotional presentation conducted on a person-to-
person basis with the buyer.
Elements of the Promotional Mix

NONPERSONAL SELLING
Promotion that includes advertising, product placement,
sales promotion, direct marketing, public relations, and
guerrilla marketing – all conducted without face-to-face
with the buyer.
Elements of the Promotional Mix

▪ Advertising
Is any paid, nonpersonal communication through various
media about a business firm, not-for-profit organization,
product, or idea by a sponsor identified in a message
intended to inform or persuade members of a particular
audience.
Elements of the Promotional Mix

▪ Product Placement
Is a form of promotion in which a marketer pays a motion
picture or television program owner a fee to display a
product prominently in the film or show.
Elements of the Promotional Mix

▪ Sales Promotion
Marketing activities other than personal selling,
advertising, guerilla marketing, and public relations that
stimulate consumer purchasing and dealer effectiveness.
Elements of the Promotional Mix

▪ Direct Marketing
Direct communications, other than personal sales
contracts, between buyer and seller, designed to generate
sales, information requests, or store or website visits.
Elements of the Promotional Mix

▪ Public Relations
Firm’s communications and relationships with its various
publics. These include customers, suppliers, stockholders,
employees, the government, and the general public.
Elements of the Promotional Mix

Publicity is the marketing-oriented aspect of public relations. It

can be defined as non-personal stimulation of demand for a
good, service, person, cause, or organization through unpaid
placement of significant news about it in a published medium
or through a favorable presentation of it on the radio or
television.
Elements of the Promotional Mix

▪ Guerrilla Marketing
Unconventional, innovative, and low-cost marketing
techniques designed to get consumer/s attention in
unusual ways.
Elements of the Promotional Mix

Buzz marketing can be part guerrilla marketing. This type of

marketing works well to reach college students and other
young adults.

Viral marketing is another form of guerrilla marketing that has

rapidly caught on with large or small firms.
Elements of the Promotional Mix

SPONSORSHIPS
Relationship in which an organization provides funds or in-
kind resources to an event or activity in exchange for a
direct association with that event or activity.
ADVERTISING
Advertising

TYPES OF ADVERTISING

▪ Product advertising is nonpersonal selling of a

particular good or service.

▪ Institutional advertising – promotion of a concept, an

idea, a philosophy, or the goodwill of an industry,
company, organization, person, geographic location or
government agency.
Advertising

OBJECTIVES OF ADVERTISING
▪ Informative advertising – promotion that seeks to
develop initial demand for a good, service,
organization, person, place, idea or cause.
Advertising

OBJECTIVES OF ADVERTISING
▪ Persuasive advertising – Promotion that attempts to
increase demand for an existing good, service,
organization, person, place, idea, or cause.
Advertising

▪ Reminder advertising – Advertising that reinforces

previous promotional activity by keeping the name or a
good, service, organization, person, place, idea, or
cause before the public.
END