CLUSTER 2:

MARKETING
PROF. GREGORIO G. BORJA III, MBA, CPME

CHAIRPERSON, DEPARTMENT OF MARKETING MANAGEMENT

SAN BEDA UNIVERSITY

AGENDA
1. MARKETING PRINCIPLES, GOALS,
TRADITIONAL, AND
CONTEMPORARY APPROACHES TO
MARKETING
2. CONSUMER DECISION MAKING,
CUSTOMER RELATIONS, AND
CUSTOMER SERVICE
3. MARKETS, MARKET
CHARACTERISTICS, MICRO AND
MACRO ENVIRONMENTS
AFFECTING CUSTOMER BEHAVIOR
4. CREATE VALUE, THROUGH
MARKETING MIX: PRODUCT, PRICE,
PLACE AND PROMOTION
5. BASIC ORAL PRESENTATION FOR
MARKETING
 WHAT IS MARKETING?

STRUCTURED-BUSINESS DEFINITION:

• A COMMERCIAL PROCESSES INVOLVED IN PROMOTING AND

SELLING AND DISTRIBUTING A PRODUCT OR SERVICE.
SIMPLEST-BASIC DEFINITION:

• THE ACT OF EXCHANGING GOODS FOR AN AGREED SUM OF MONEY.

 Exchange

GOODS PAYMENT

Marketer Customer
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall
IS THIS STILL THE MOST EFFECTIVE
WAY TO SEE AND PERFORM
MARKETING???

ARE WE STILL GOING TO BE

SUCCESSFUL IF WE APPLY THIS
MARKETING PHILOSOPHY???
 HOW DO YOU
MAKE
MARKETING
EFFECTIVE FOR
YOU?
 THE NEW AND MODERN
DEFINITION OF MARKETING:
• “THE PROCESS BY WHICH COMPANIES CREATE
VALUE FOR CUSTOMERS AND BUILD STRONG
RELATIONSHIPS IN ORDER TO CAPTURE VALUE
FROM CUSTOMERS IN RETURN”

- PHILIP KOTLER
WHAT DO THESE BRANDS
HAVE IN COMMON?
MUCH ABOUT SELLING,
BUT ABOUT CREATING
PRODUCTS THAT DON'T
NEED SELLING”

TEN DEADLY MARKETING

SINS, PHILIP KOTLER
SELLING VS. MARKETING
CONCEPT
 PUTTING VALUE TO THE
SCOPE OF MARKETING

* PLACES * GOODS
* PROPERTIES * SERVICES
* ORGANIZATIONS* EXPERIENCES
* INFORMATION * EVENTS
* IDEAS * PERSONS
The Marketing Process
 STEP 1:
UNDERSTANDING THE
MARKETPLACE AND
CUSTOMER NEEDS AND
WANTS
CORE MARKETING CONCEPTS
MARKET
THE SET OF ALL ACTUAL AND
POTENTIAL BUYERS OF A PRODUCT
OR SERVICE

EXCHANGE
THE ACT OF OBTAINING DESIRED OBJECT
FROM SOMEONE BY OFFERING SOMETHING
IN RETURN

TRANSACTION
A TRADE BETWEEN TWO PARTIES THAT
INVOLVES AT LEAST TWO THINGS OF VALUE,
AGREED UPON CONDITIONS, A TIME OF
AGREEMENT AND A PLACE OF AGREEMENT.
NEEDS
STATE OF FELT DEPRIVATION, THE
NECESSITIES

WANTS
THE FORMED HUMAN NEEDS, SHAPED BY
CULTURE AND INDIVIDUAL PERSONALITY

DEMANDS
HUMAN WANTS THAT ARE BACKED BY
BUYING POWER.
MASLOW’S HIERARCHY OF NEEDS
 SOCIO ECONOMIC CLASS
(CONSUMER CLASSIFICATIONS)
Almost every society has some form of social class structure. Social
classes are society’s relatively permanent and ordered divisions whose
members share similar values, interests, and behaviors.

Social class is not determined by a single factor, such as income, but is

measured as a combination of occupation, income, education, wealth,
and other variables.

Marketers are interested in social class because people within a given

social class tendencies in areas such as clothing, home furnishings,
travel and leisure activity, financial services, and automobiles.
 MAJOR CONSUMER CLASSES
A – (Upper Class) Referred to as rich and wealthy, with very
comfortable lives, finished education in a prestigious schools, owns big
businesses, wealth is passed on within their families, earnings are more
than the usual expected annual income.

B – (Middle Class) Professionals, able to finish education, most are

successful and earning well because of their skills and talents, they have
enough to provide for their families. Most of them are categorized
having white collar jobs holding top positions in the industry and are
earning well.
C – (Working Class) The labor force of the economy, most of those who
are starting to make money. Most of them are categorized having blue
collar jobs having skill or technical oriented jobs. Some are able to
finish their education and some are struggling to finish theirs. Their
spending power is limited and highly on a budget. Only enough to get
them through the day.

D – (Lower Class) Considered poor in terms of social status. Most of

them have unstable jobs due to lack of opportunities and are unable to
finish or at least struggling to finish their education. Income is very
unstable, low spending power, focusing only on their daily needs.

E – (Poorest of the poor) No income, considered as beggars, struggling

to make a living day by day having a hard time even to fulfill their basic
needs.
 SOCIO-
ECONOMIC
MAKE UP IN
THE
PHILIPPINES
SOCIO-ECONOMIC MAKE UP IN THE PHILIPPINES (2022)
 Customer Value - the differences between the values that the customer gains from
owning and using a product and the costs of obtaining products.

Value = Benefits = (Functional + Emotional Benefits)

Cost (Monetary Costs + Time Costs +
Energy Costs + Psychic Costs)

 Customer Satisfaction – The extent to which a product’s perceived performance in

delivering value matches a buyers expectations.

 Quality – the characteristics of a product or service that bear its ability to satisfy a stated
or implied customer needs.
 Relationship Marketing – the process of creating, maintaining, and
enhancing strong, value-laden relationships with customers and other
stakeholders.

 Marketing Management as the art and science of choosing target markets

and building profitable relationships with them.

The marketing manager’s aim is to find, attract, keep, and grow target
customers by creating, delivering, and communicating superior customer value.
MANAGING MARKETING

Marketing Management functions:

* Analysis * Planning * Implementation * Control

 MARKET AUDITING ANAYSIS TOOLS
&
BUSINESS PORTOFLIO ANALYSIS TOOLS
 EXTERNAL AUDIT ANALYSIS TOOLS

 PESTLE (MACRO ENVIRONMENT ANALYSIS)

 MICRO ENVIRONMENT ANAYSIS
 PORTER’s 5 Forces

INTERNAL AUDIT ANALYSIS TOOLS

o Mckinsey’s 7S
o SWOT Analysis
MACRO ENVIRONMENT - PESTLE
 REMINDERS WHEN WRITING THE
PESTLE!
 Putting information to every factor in the PESTLE just for the sake of filling out every factor is
WRONG!!!

 There is no number of requirement to fill for each factor!

 Evaluate each factor and fill up with information if the factor greatly affects your industry.
Choose the most relevant ones!

 Sometimes not all factors can be filled up and that is ok! Just make sure that you can defend
why there is no need to provide information in that factor.

 Lifting and quoting lines from articles, journals, researches and other reliable sources are fine
for as long as you cite the source/s properly in your analysis.

 Make sure to come up with your own analysis! Learn how to rephrase, DO NOT JUST COPY
and PASTE!!!
MICRO ENVIRONMENT
 PORTER’S 5 FORCES
Declare your
assessment for each
force:

 High (Intensive)
 Mid (Moderate)
 Low (Weak)

Support your
assessment with data
and your analysis
MCKINSEYS 7’S
 SWOT
ANALYSIS
 REMINDERS WHEN WRITING SWOT ANALYSIS!
 Putting information to every quadrant under SWOT just for the sake of filling out every quadrant is WRONG!!!

 There is no number of requirement to fill for each quadrant of SWOT! Just make sure that all your information are true and
correct!

 Be specific and precise when putting information especially for your Strengths and Weaknesses! Make sure that you do a
deep dive analysis, always get to the bottom and the main reason of why you chose to include the information! (Always ask
the question “WHY?” “Is my reason enough?”)

 For your Strengths, as much as possible choose an information that is uniquely yours (for the brand/company) to claim,
meaning it cannot be easily copied or applied by other brands/competitors!

 Your Opportunities and Threats should be branching out from your MACRO and MICRO Analysis or Porter’s

 Avoid redundancy of information! Merge the items or information that you find very similar.

 Your business instincts will tell you if your items in the SWOT are enough, make sure to review before finalizing it.

 BE TRUE TO YOUR ANALYSIS, DO NOT SUGAR COAT!!!

MARKETING STRATEGY AND THE
MARKETING MIX
• MARKETING STRATEGY – THE MARKETING LOGIC BY
WHICH THE BUSINESS UNIT HOPES TO CREATE CUSTOMER
VALUE AND ACHIEVE PROFITABLE CUSTOMER
RELATIONSHIPS.

• MARKETING MIX – THE SET OF CONTROLLABLE TACTICAL

MARKETING TOOLS THAT THE FIRM BLENDS TO PRODUCE
THE RESPONSE IT WANTS IN THE TARGET MARKET.
 STEP 2:
Designing a Customer
Driven Marketing Strategy
 COMPANYWIDE STRATEGIC
PLANNING PROCESS DEFINING
MARKETING’S ROLE
• STRATEGIC PLANNING – THE PROCESS OF DEVELOPING
AND MAINTAINING A STRATEGIC FIT BETWEEN THE
ORGANIZATION’S GOALS AND CAPABILITIES AND ITS
CHANGING MARKETING OPPORTUNITIES.
 STEPS IN STRATEGIC PLANNING
Business unit,
product and
Corporate Level market level

Planning
Defining Setting Designing marketing
the company the and other
company objectives business functional
mission and goals portfolio strategies
DIFFERENCE OF STRATEGY TERMS

Longer Term Shorter Term

Companywide VISION MISSION

Departmental GOAL OBJECTIVE

 SETTING COMPANY/MARKETING
OBJECTIVES
• “MARKETING OBJECTIVES SHOULD LEAD TO SALES”
THEY SHOULD BE:
S – SPECIFIC
M – MEASURABLE
A – ATTAINABLE
R – RELEVANT
T - TIMEBOUND
 EXAMPLES OF MARKETING OBJECTIVES:
• INCREASE PRODUCT AWARENESS AMONG THE TARGET
AUDIENCE BY 30 PERCENT IN ONE YEAR.

• INFORM TARGET AUDIENCE ABOUT FEATURES AND

BENEFITS OF OUR PRODUCT AND ITS COMPETITIVE
ADVANTAGE, LEADING TO A 10 PERCENT INCREASE IN
SALES IN ONE YEAR.

• DECREASE OR REMOVE POTENTIAL CUSTOMERS'

RESISTANCE TO BUYING OUR PRODUCT, LEADING TO A 20
PERCENT INCREASE IN SALES THAT ARE CLOSED IN SIX
MONTHS OR LESS.
3 MAJOR DIRECTIONS OF MARKETING OBJECTIVES
• SHARE OF WALLET (#1 IN PROFITS/SALES)
• INCREASE SALES %
• INCREASE PROFIT/REVENUE %
• INCREASE MARKET SHARE %
• INCREASE CUSTOMER SATISFACTION
• DECREASE MARKETING EXPENSES
• SHARE OF MIND (TOP OF MIND/POPULARITY)
• INCREASE AWARENESS / TO INFORM / TO EDUCATE
• INCREASE TRIAL
• INCREASE ADVERTISING EFFORTS/EXPOSURE
• INCREASE DIGITAL PRESENCE
• INCREASE POSITIVE IMPRESSIONS (LIKES, SHARES, POSITIVE COMMENTS,
WORD OF MOUTH)
• IMPROVE POSITIVE IMAGE
• SHARE OF HEART (CORPORATE SOCIAL RESPONSIBILITY, GOOD IMAGE,
PHILANTHROPY)
• COMMUNITY ENGAGEMENTS/PROJECTS
• COLLABORATIONS/PARTNERSHIPS FOR A GOOD CAUSE
• BENEFICIARIES, DONATIONS, CHARITABLE EVENTS, ETC.
 HOW DO WE MEET OUR SET
MARKETING OBJECTIVES?

AND

HOW DO WE ENSURE EFFECTIVE

MARKETING STRATEGIES?
 STP = D USP

 Segmentation  Differentiation  Unique Selling

 Targeting Proposition
 Positioning
 Market Segmentation - dividing a market into smaller groups
with distinct needs, characteristics, or behaviors who might require
separate products or marketing mixes.

 Market Targeting - the process of evaluating each market

segment’s attractiveness and selecting one or more segments to
enter.

 Positioning – arranging for a product to occupy a clear,

distinctive, and desirable place relative to competing products in
the minds of target consumer.

 Differentiation – Actually differentiating the firm’s market

offering to create superior customer value.
 MARKET SEGMENTATION
Market Segment – a group of consumers
who respond in a similar way to given set
of marketing effort.

 SEGMENTING CONSUMER MARKETS (B2C)

 SEGMENTING BUSINESS MARKETS (B2B)
 SEGMENTING INTERNATIONAL MARKETS
 REQUIREMENTS FOR EFFECTIVE SEGMENTATION
4 BASES FOR MARKET
SEGMENTATION
(FOR CONSUMER MARKETS)

•GEOGRAPHIC
•DEMOGRAPHIC
•PSYCHOGRAPHIC
•BEHAVIORAL
SEGMENTING BUSINESS MARKETS
• GEOGRAPHICALLY

• BY INDUSTRY

• BY COMPANY SIZE

• BY ITS CUSTOMER OPERATING CHARACTERISTICS

• BY SITUATIONAL FACTORS

• AND BY OTHER COMPANY CHARACTERISTICS.

 SEGMENTING INTERNATIONAL
MARKETS
• GEOGRAPHICALLY (CONTINENT, REGION),
• BY ECONOMIC STATUS,
• BY CULTURE,
• BY ITS POLITICAL MAKE UP,
• OR BY DISTINCT BUYING NEEDS AND BEHAVIOR OF THEIR PEOPLE.
REQUIREMENT FOR EFFECTIVENESS
SEGMENTATION:
MAKE SURE THAT YOUR SEGMENTS ARE:
MEASURABLE – CAN BE MEASURED
ACCESSIBLE – CAN BE EFFECTIVELY REACHED AND SERVED
SUBSTANTIAL - LARGE OR PROFITABLE TO SERVE
DIFFERENTIABLE – RESPONDS DIFFERENTLY
ACTIONABLE – CAN BE DESIGNED FOR ATTRACTING AND SERVING
THE SEGMENTS.
 MARKET TARGETING
EVALUATING MARKET SEGMENTS TO TARGET:
 SEGMENT SIZE AND GROWTH
 SEGMENT STRUCTURAL ATTRACTIVENESS
 COMPANY OBJECTIVES AND RESOURCES
SELECTING TARGET MARKET SEGMENTS:
DECIDES WHICH AND HOW MANY SEGMENTS IT WILL
TARGET, TARGET MARKET CONSISTS OF SET OF BUYERS
WHO SHARE COMMON NEEDS OR CHARACTER THAT THE
COMPANY DECIDES TO SERVE.
HOW BIG IS YOUR MARKET AND
THEIR LEVEL OF AWARENESS?
SCALABLE MARKET
(Unaware)

60%
ADDRESSABLE
MARKET
20% (Problem Aware)

AVAILABLE
17% MARKET
(Solution Aware)

3%
IDEAL MARKET
(MOST AWARE)
 TARGET MARKETING STRATEGY
THE MASSES
Targeting broadly Undifferentiated
Marketing Strategy

THE SEGMENTED
MARKET
Differentiated
Marketing Strategy

THE NICHE
MARKET
Concentrated
Marketing Strategy

LOCAL OR
INDIVIDUAL
MARKET
Targeting Micromarketing
narrowly Strategy
UNDIFFERENTIATED (MASS) MARKETING - A MARKET-COVERAGE STRATEGY IN
WHICH A FIRM DECIDES TO IGNORE MARKET SEGMENT DIFFERENCES AND GO AFTER
THE WHOLE MARKET WITH ONE OFFER.

DIFFERENTIATED (MASS) MARKETING - A MARKET-COVERAGE STRATEGY IN

WHICH A FIRM DECIDES TO TARGET SEVERAL MARKET SEGMENT AND DESIGN
SEPARATE OFFERS FOR EACH.

CONCENTRATED (NICHED) MARKETING - A MARKET-COVERAGE STRATEGY IN

WHICH A FIRM GOES AFTER A LARGE SHARE OF ONE OR FEW SEGMENTS OR NICHES.

MICROMARKETING (LOCAL OR INDIVIDUAL) MARKETING - THE PRACTICE OF

TAILORING PRODUCTS AND MARKETING PROGRAMS TO THE NEEDS AND WANTS OF
SPECIFIC INDIVIDUALS AND LOCAL CUSTOMER GROUPS-INCLUDES LOCAL
MARKETING AND INDIVIDUAL MARKETING
EXERCISE:
SEGMENTATION AND TARGETING

• WHAT SEGMENTATION VARIABLES SHOULD WE USE FOR DETERMINING OUR

MARKET SEGMENTS AND EVENTUALLY OUR TARGET MARKET, IF WE CHOOSE
TO PUT UP OUR OWN

TRAVEL AGENCY BUSINESS?

 You may choose to TARGET or to have multiple
Target Markets, but always identify who is your
PRIMARY TARGET MARKET and SECONDARY TARGET
MARKETS
(Know who and what to prioritize)
 CHOOSE FOR EXAMPLE:
SEGMENTED TARGETING/MARKETING
SHOULD WE CHOOSE TO GO FOR HIGHER VALUE OF
CUSTOMERS WHERE WE CAN EARN MORE…

PRIMARY TARGET MARKET:

B2NMC/B2BB
7 STAR/5 STAR
BUSINESS/BLEISURE
EUROPE
AMERICAN/JAPANESE (COMPANIES)
 CHOOSE FOR EXAMPLE:
SEGMENTED TARGETING/MARKETING

• SHOULD WE CHOOSE TO CATER ALSO FOR A BIT OF A MASS

LEVEL OF MARKET SO THAT WE CAN CAPTURE DIFFERENT
MARKET SEGMENTS…

SECONDARY TARGET MARKET:

B2C: FAMILIES
MIDDLE CLASS/MASSES – ECONO FLIGHT
LEISURE
ASIA
FILIPINOS
 THUS THE PRODUCT/SERVICE OFFERINGS…

You can actually design your

market offering based on your
target market
 POSITIONING FOR COMPETITIVE
ADVANTAGE
• POSITIONING MAPS
• CHOOSING A POSITIONING STRATEGY
• COMMUNICATING AND DELIVERING THE CHOSEN POSITION

POSITIONING basically asks the question…

How do you want your products to be
perceived?????
POSITIONING THE TWO BRANDS

Brand A Brand B

A Germicidal Soap A Beauty Bar

 POSITIONING MAPS
Show consumer perceptions of their brands versus
competing products. Provide important marketing insights:

 Different brands occupy different “spaces” in the maps.

 Brands are sometimes clustered together indicating the
existence of possible market segment where there is a
concentration of preferences based on specific product
attribute.
 Indicate “empty spaces” where no or few competitors
exist.
EXAMPLES OF PRODUCT POSITIONING MAPS
FOR FAST FOOD
 CHOOSING A POSITIONING STRATEGY
Consist of three steps:
 Identifying possible competitive advantage
 Choosing the right competitive advantage
 Selecting an overall strategy positioning strategy

Identifying possible competitive advantage

The key to winning target customer and building profitable relationships
with them is to understand their needs better than competitors do and
deliver more value.
Choosing the right competitive advantage
After discovering several potential competitive advantages, it must
choose the ones on which it will build its positioning strategy.
 SELECTING AND OVERALL POSITIONING
STRATEGY (POSITIONING OPTIONS)

Positioning by Product Attribute: Nakasisiguro gamot ay laging bago

Positioning by Price: Your low price, great value airline

Positioning by User Segment: Mabuhay! We’ve been expecting you

Positioning by Usage Behavior:

Creating the dream cleavage every woman deserves
 Positioning by Product Source: Made in Korea

Positioning by Product Category: The 70% Isopropyl Alcohol

 Positioning Against Competition:
Recommended by 8 out of 10 dentists

Positioning by Experience or Feeling:

It must be Shangri-La!
DEVELOPING THE POSITIONING
STATEMENT
Example:

“For all classes of families, SM is the only

mall that provides you with everything that
you need, its fun, enjoyable and affordable at
the same time”

Thus the tagline: Here at SM….

“We’ve got it all for you”
 COMMUNICATING AND DELIVERING THE
CHOSEN POSITIONING

Positioning strategy

Maintain position through:

• Consistent performance and communication
• Monitoring and adapting to consumer needs and competitors’ strategies

Promotion Distribution Product Pricing

strategy strategy strategy strategy
 STEP 3:
Constructing an Integrated
Marketing Program that
Delivers Superior Value
 MARKETING MIX DEFINED

• THE TERM “MARKETING MIX” BECAME POPULARIZED AFTER

NEIL H. BORDEN PUBLISHED HIS 1964 ARTICLE, THE CONCEPT
OF THE MARKETING MIX. BORDEN BEGAN USING THE TERM
IN HIS TEACHING IN THE LATE 1940’S AFTER JAMES
CULLITON HAD DESCRIBED THE MARKETING MANAGER AS
A “MIXER OF INGREDIENTS”.

• E. JEROME MCCARTHY LATER GROUPED THESE

INGREDIENTS INTO CATEGORIES THAT TODAY ARE KNOWN
AS THE P’S OF MARKETING.
 THE MARKETING MIX
(THE 4 P’S OF MARKETING)
• MARKETING DECISIONS GENERALLY FALL INTO THE FOLLOWING FOUR
CONTROLLABLE CATEGORIES:

PRODUCT
PRICE
PLACE (DISTRIBUTION)
PROMOTION
THE MARKETING MIX
• THESEFOUR P’S ARE THE PARAMETERS THAT THE
MARKETING MANAGER CAN CONTROL, SUBJECT TO THE
INTERNAL AND EXTERNAL CONSTRAINTS OF THE
MARKETING ENVIRONMENT.

• THE GOAL IS TO MAKE DECISIONS THAT CENTER THE

FOUR P’S ON THE CUSTOMERS IN THE TARGET MARKET IN
ORDER TO CREATE PERCEIVED VALUE AND GENERATE A
POSITIVE RESPONSE.
7PS – PRICE, PRODUCT, PROMOTION, PLACE,
PEOPLE, PROCESS, PHYSICAL ENVIRONMENT

TRADITIONAL 4PS EXTENDED TO ENCOMPASS

GROWTH OF SERVICE INDUSTRY
 SUMMARY OF MARKETING MIX
DECISIONS
Product Price Place Promotion

Brand name List price Distribution Advertising

Functionality Discounts channels Personal selling
Appearance Allowances Channel members Public relations
Styling Wholesale Inventories Direct marketing
Quality pricing Warehousing Digital marketing
Safety Cash, early Market coverage Communication
Packaging payment Locations message
Seasonal
Warranty pricing Transportation Media channels
Accessories Bundling Logistics/reverse Promotional
Service/Support Service levels budgeting
CREATING CUSTOMER VALUE
AND RELATIONSHIPS
4P’s 4C’s

PRODUCT = CUSTOMER SOLUTION

PRICE = CUSTOMER COST
PLACE = CONVINIENCE
PROMOTION = COMMUNICATION