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Lecture 3: Marketing Plan, Strategies,
Distribution and Channels
Dr Bernard Leong
CTO & Co-founder
MPS 812 Course Taught in:
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What is Marketing?
• Marketing deals and social needs.&
meeting human
with identifying
• Marketing isa“an organizationalfor
function and set of processes
creating, communicating & delivering
value for customers & for managing
relationships in ways that benefit the
organizations & its stake
holders.” (American Marketing
Association)
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What is Marketing?
• Marketing Management: the art &
science of choosing target
markets & getting, keeping &
growing customers thru creating,
delivering, & communicating
superior customer value.
• Marketing is a societal process by
which individuals & groups obtain
what they need and want thru
creating, offering & freely
exchanging products/services of
value with others.
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What is Marketed?
• Goods
• Services
• Events
• Experiences
• Persons
• Places
• Properties
• Organizations
• Information
• Ideas
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Marketers & Prospects
• A marketer: purchase, vote, donation) from
(attention, a
Someone seeking a response
another party call the prospect.
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8 Demand States
• Negative Demand: Consumers
dislike the product & may pay a
price to avoid it.
• Non-existent Demand:
Consumers are unaware or
uninterested in the product.
• Latent Demand: Consumers
share a strong need that cannot
be satisfied by an existing
product.
• Declining Demand: Consumers
begin to buy the product less
frequently.
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8 Demand States
• Irregular Demand: Consumer
purchases vary on a seasonal,
monthly, weekly, daily or even hourly
basis.
• Full Demand: Consumers are
adequately buying all products put in
the market place.
• Overfull Demand: More consumers
would like to buy the product that
can be satisfied.
• Unwholesome demand: Consumers
may be attracted to products that
have undesirable social consequences.
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Resources Resources
Resource
Money Markets Money
Taxes, Services,
Goods Money
Services,
Money Taxes
Manufacture Government Consumer
Markets Markets Markets
Taxes, Services
Goods
Services, Taxes,
Money Goods
Money Money
Intermediary
Goods & Services Goods & Services
Markets
Structure of Flows in a Modern Exchange Economy
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Marketers use the term market to cover various
groupings of customers.
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Types of Markets
• Consumer Markets
• Business Markets
• Global Markets
• Non-Profit & Governmental
Markets
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Marketing Practices
• Marketing steps: process
involves 5
planning
• Analyzing marketing
opportunities
• Selecting target markets
• Designing marketing
strategies
• Developing market
programs.
• Managing the marketing
effort - Execution
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Integrated Marketing Approach: 4 Ps of Marketing
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Product
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Positioning of Product
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Price
Quality of Product
High Low
High
Superior Brand
Quality
Price
Value for
Low
Economical
Money
Pricing Strategy Matrix
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How to Set the Price
• Selecting the Price Objective - Position
of market offering due to survival,
High Price
maximum current profit, maximum (No possible demand
market share or maximum market- at this price)
skimming pricing.
• Determining Demand - Price Sensitivity
- methods include surveys, price
Costing Price
Customers assement of
experiments and statistical analysis. unique product features
• Estimating Costs - Charging a price
based on cost of producing, distributing
Orienting Point
Competitors’ prices & prices
of substitutes
and selling of a product. Costs
• Analyzing competitors’ costs, prices &
offers
Floor Price
• Selecting a price method: for e.g.
markup pricing, target return pricing,
Low Price
(No possible profit
value pricing. at this price)
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Promotion: Common Platforms
Sales Events/ Public Relations Personal Direct
Advertising Promotion Experiences & Publicity Selling Marketing
Print & Broadcast
Ads, Contests, games,
Packaging-outers, sweepstakes,
Packaging inserts, lotteries, Press Kits,
Motion Pictures, Premium & gifts, Speeches,
Brochures & Samples, Seminars,
Booklets Fairs & trade shows, Sports, Annual Reports, Catalogs,
Posters & leaflets, Exhibits, Entertainment, Charitable Sales presentations, Mailings,
Directories Demonstrations, Festivals, Donations, Sales meetings, Tele-marketing,
Reprint of Ads, Coupons, Arts, Sponsorships, Incentive programs, Electronic Shopping,
Billboards, Rebates Courses, Publications, Samples, TV shopping,
Display Signs, Low-interest Factory Tours, Community Fairs and Trade Fax-mail
Point of purchase financing, Company Museums, Relations, Shows Email
displays, Entertainment, Street Activities Lobbying, Voice mail
Audiovisual Trade-in allowances, Identity Media
materials, Continuity Company Magazine
Symbols and logos Programs, or newsletters
Videotapes, CD, Tie-ins
DVDs
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Place
Customer
• Distribution Channel
• Integration based on Merger
& Acquisition:
Retailer/
• Manufacturer acquires
Wholesaler (Forward
Dealer
Integration)
• Wholesaler acquires
Manufacturer (Backward
Wholesaler/
Distributor
Integration)
• Retailer buys over another
Retailer (Parallel Manufacturer/
Integration) Sole Importer
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Packaging
• Physical Presentation
• Value Added Qualities
• Bundled Package
(Product with
Service)
• One Stop Services
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SWOT Analysis
• Strength, Weaknesses,
Opportunities and
Threats (SWOT)
• Involves monitoring
the external and
internal marketing
environment.
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Strength/Weaknesses
Features to measure performance or
Functionality importance
Company reputation, Market Share, Customer Satisfaction,
Customer Retention, Product or Service Quality, Pricing
Marketing Effectiveness, Distribution Effectiveness, Promotion
Effectiveness, Sales Force Effectiveness, Innovation Effectiveness,
Geographical Coverage.
Finance Cost & Availability of Capital, Cash Flow, Financial Stability.
Facilities, Economics of Scale, Capacity, Able & Dedicated
Manufacturing Workforce, Ability to produce on time, Technical manufacturing
skill.
Visionary & capable leadership, Dedicated Employees,
Organization Entrepreneurial Orientation, Flexible or Responsive.
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Opportunity/Threat
• A marketing opportunity is an area
of buyer need & interest in which
there is a high probability that a
company can profitably satisfy that
need.
• Three main sources of market
opportunities:
• Supply something that is in
demand.
• Supplying product or service in a
new or superior way.
• Totally new product that bring
about a new consumer behavior
or impact.
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Opportunities
• A company may benefit from converging
industry trends & introduce hybrid
products or services that are new to the
market.
• A company may make a buying process
more convenient or efficient.
• A company can meet the need for more
information or advice.
• A company can customize a product or
service that was formerly offered in a
standard form.
• A company can introduce a new capability.
• A company may be able to deliver a
product or service faster.
• A company may be able to offer a product
at a much lower price.
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Questions for Market Opportunity Analysis
• Can the benefits involved ina the opportunity be
articulated convincingly to defined target market?
• Can the targetmedia & trade located & reached with
cost effective
market(s) be
channels?
• Does the company&process or have accessdeliver
critical capabilities resources needed to
to the
customer benefits?
• Can the company deliver the benefits better than any
actual or potential competitors?
• Will the financial ratefor investment? or exceed the
company’s threshold
of return meet
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Success Probability
High Low Example
1. Company develops
more powerful
Attractiveness
Low
1 2 lighting system.
2. Company develops
device to measure
energy efficiency.
3. Company develops
High
3 4 device to measure
illumination level.
4. Company develops
software program to
teach lighting
Opportunity Matrix fundamentals to TV
studio personnel.
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Probability of Occurrence
High Low Example
1. Competitor
Low
develops superior
Seriousness
1 2
lighting system.
2. Major prolonged
economic
depression.
High
3 4
3. Higher Costs.
4. Legislation to
reduce number of
Threat Matrix TV licenses.
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Marketing Channels
• Marketing Channels are sets
of interdependent
organizations involved in the
process of marketing a
product or service available
for consumption and use.
• Set of pathways which
follows after production,
culminating in purchase &
use by the final user.
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Push/Pull Strategy
• A push strategy involves the manufacturer using
its sales force & trade promotion money to
induce intermediaries to carry, promote & sell the
product to the end-user.
• A pull strategyinduce consumers to ask using
advertising to
involves the manufacturer
intermediaries for the product and is appropriate
when there is high brand loyalty & involvement in
the category when people perceive differences
between brands.
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What is branding?
• A brand is the symbolic embodiment of all information encoded
with a product or service.
• Branding is the processwithwhich of company, product or image
becomes synonymous
by a
a set values, aspirations or states.
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Brands in the World
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Key Elements in Brands
Experiential Visual
Functional Brand Cultural
Emotional Rational
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Principles of Influence for Marketing/Sales
• Aristotle (Rhetoric)
• Logos (Logic)
• Pathos (Emotion)
• Ethos (Ethics)
• R. Cialdini - 6 Rules of
Influence
• Reciprocation, Commitment
& Consistency, Authority,
Social Proof, Liking & Scarcity
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Reciprocation
• People generally feel obliged to return favours
to them.
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Commitment & Consistency
• People have a general desire to appear consistent in
their behavior.
• Strongthem. to commitments by providing reasons to
justify
desire
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Social Proof
• People generally look to decisions. similar
to themselves in making
other people
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Liking
• People are more likely agree to brands which
they like:
• Physical Attractiveness
• Common goals
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Authority
• People act in anparticularly to leading brands.
from authority,
automated fashion to commands
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Scarcity
• People tend to want brands as they become
less available.
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Inventory Storage & Distribution Costs Insignificant
User Driven Innovation
Opportunities for Niches Markets
Signal to Noise is higher
Niche getting to the Mainstream is tough
Platforms are “Walled Gardens”
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What is social media?
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Why Startups need Social Media
• Getting the attention of the
mainstream media.
• Budget afford big marketing
able to
constraints and not
budgets.
• Advertising and Marketing
purposes.
• Crisis management given no
PR channels
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Crisis Management - Kryptonite
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Mainstream Media Social Media
Principle behind 80-20 Rule Long Tail
Channel Distribution
Users Consumers Prosumers
Cable TV, Radio, Printed Media - YouTube, Blogs, Social Networks
Channel Examples Newspaper (Facebook, Ning), Flickr, Twitter
UStream, Qik, Wikis
Bottom Up (Niche)
Approach Top to Bottom to Top
Feedback/Engagement Very little A lot
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Social Media Tools
• Blogs - Blogger/Wordpress/Tumblr/
Posterous
• Rich Media Sharing - Flickr,YouTube,
Vimeo, PhotoBucket, Picasa, Phlook,
Todou.
• Social Networks - Facebook,
Linkedin, Ning, CyWorld
• MicroBlogging - Twitter, Plurk,
Yammer
• Aggregators - Digg, StumbleUpon
• Online Forums - HardwareZone
(HWZ), Comsenz
• Mobile: FourSquare, Gowalla
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Social Technographics Ladder
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Case Study 1: Corporate Blog Page for Start-Ups
Singapore based
Case Study:
blog.zopim.com
To engage users and
let them know the
latest features of the
web application.
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Case Study 2: Facebook Pages for Non-Profit Organizations
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How to measure ROI for marketing for Facebook
Source: Ogilvy 360 “Facebook For Businesses”
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Case Study 3: Twitter for Start-Ups
• Start by identifying your start-ups or
communications objective using
Twitter:
• Customer Service - e.g
@starhubcares
• Product Promotion & Sales - e.g.
@vodafonenews_au
• Crisis Management - e.g.
@flusingapore
• Events activation
• Issue Advocacy
• Corporate Reputation Management
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Source: Ogilvy 360 “Twitter For Businesses”
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Twitter to track major events: Singapore Idol 2009
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