FAE Core – Marketing

1. FAE Core – Marketing

2. Hello

3. Studying marketing for FAE • Resource pack • Online session • Classroom session • Integrated case days • Own study of cases mashable.com

4. FAE competency statement – marketing principles • Understand the significance of marketing in the strategic development of an enterprise • Understand and apply the principles of marketing to a wide range of industries • Discuss the financial implications of marketing decisions • Display an appreciation of the specific additional requirements of the marketing of services • Explain the opportunities offered by new marketing media, including the internet • Display an understanding of the various elements within a marketing plan • Demonstrate the appropriate integration of a marketing dimension into solutions for typical business issues

5. Four competencies we’ll cover online today • Understand the significance of marketing in the strategic development of an enterprise • Understand and apply the principles of marketing to a wide range of industries • Discuss the financial implications of marketing decisions • Display an appreciation of the specific additional requirements of the marketing of services • Explain the opportunities offered by new marketing media, including the internet • Display an understanding of the various elements within a marketing plan • Demonstrate the appropriate integration of a marketing dimension into solutions for typical business issues

6. But first…

7. Why are we here?

8. What is marketing?

9. What is marketing? • “The management process responsible for identifying, anticipating and satisfying customer requirements profitably” Chartered Institute of Marketing, UK

10. Marketing is an offshoot of economics but “psychology” is key

11. Why does marketing have a bad rep?

12. So why are we here? http://sharedconceptsbusinessstudiesblog.net/2012/08/29/key-business-functions/ sharedconceptsbusinessstudiesblog.net/

13. In fact, marketers & accountants share an objective • “The management process responsible for identifying, anticipating and satisfying customer requirements profitably” Chartered Institute of Marketing, UK

14. 1 - Understand the significance of marketing in the strategic development of an enterprise

15. Marketing in the strategic development of an enterprise • A little bit of history • Marketing as a business process

16. A short history of marketing (http://vimeo.com/2897291)

17. Different companies are at different stages nowadays too

18. Marketing as a business process: marketing for growth Some ways to grow a business: • Stimulate demand for existing products/services • Entering new markets geographical, sectoral, category • Creating new markets – innovation (moving up the value chain, creating new markets altogether); brand extension or diversification • Taking a competitors business – take-over or by eroding market share Marketing!

19. Marketing as a business process: informing decisions

20. Marketing as a business process: informing decisions • Define the Problem / Research Objective • Develop the Research Plan • Primary / Secondary Research? • Sample size? • Research format? • Implement the Research Plan • Interpret & Report Findings

21. Marketing as a business process: expressing the company Marketing activities often forces decisions – e.g. the expression of a company's • Vision • Mission • Values

22. Key take-aways • Marketing is the management process responsible for identifying, anticipating and satisfying customer requirements profitably • Over the years, we have moved from a production-oriented business, to a sales-focus, towards marketing and we are in and entering the social age. Many businesses go through this evolution too • The way a business deals with marketing directly impacts its bottom line – as a CA you’ll shape businesses and contribute to this view

23. 2 - Understand and apply the principles of marketing to a wide range of industries

24. Applying marketing principles to different industries Things you’ll hear marketers talking about • The 4/7/? P’s • Purchase funnel • The players – 3 C’s • SWOT analysis • PESTLE analysis • Porter’s 5 forces • Brands!

25. Applying marketing principles – The 4 P’s http://business-fundas.com/2011/

26. Applying marketing principles – now there are 7 Ps!

28. What kind of CEO would you be? • 1 P CEO – just wants the marketing department to communicate & promote • 4 P CEO – Wants a planned approach to product, price, place, promotion • STP CEO – Leads the work on segments, targets and position • A “ME” CEO – believes that marketing is everything. Believes no customer -> no business

29. 4 P’s – case study hot wheels

30. Applying marketing principles – purchase funnel

31. Applying marketing principles – 3C’s (Kenichi Ohmae)

32. SWOT berlinlcalling.wordpress.com

33. PEST(LE) • Political • Economic • Social • Technological • Legal • Environmental http://www.businessballs.com

34. Applying marketing principles – Porter’s 5 forces

35. Brands – Seth Godin’s view http://youtu.be/QRTsQWA3NnM Video from InsightOne20·

36. Brands – practical components • Name: The word or words used to identify a company, product, service, or concept • Logo: The visual trademark that identifies the brand • Tagline or Catchphrase – “every little helps” • Graphics / Shapes – apple’s apple! • Colours – Heineken Green? • Sounds / scents / tastes – Nokia ringtone, Microsoft power down!

37. Brands quiz • Whose logo? • Whose shape? • Whose font? • Whose colour?

38. Key take-aways When considering business issues with a marketing consideration, there are a huge range of tools, including: • The 4/7/ P’s • Purchase funnel • The players – 3 C’s • SWOT analysis • PESTLE analysis • Porter’s 5 forces • Brands architecture

39. 3 - Discuss the financial implications of marketing decisions

40. Financial implications • Marketing budgets • Measurement

41. Marketing budgets… "Half the money I spend on advertising is wasted; the trouble is I don't know which half.” (John Wanamaker)

42. Not spending on marketing

43. Marketing budgets as a strategic decision • Samsung recently announced a $14bn dollar marketing budget 5.4% of turnover – biggest ever. Compare this to apple’s marketing budget of 0.6%

44. How much should a marketing budget be? • Some brands operate a zero marketing budget model – really exceptional, generally operate on contra basis – most likely to be for a media or content, services provider • Marketrsaim to justify all marketing expenditures from a zero base each year against the task intended. • Average is ~4% of turnover • Early phase businesses may need to invest more – entering markets can be expensive (listing fees, creating brand awareness, licencing arrangements…)

45. What are the areas of marketing spend? Fixed costs • Sales and marketing staff & costs • Required items such as listings fees, sales promotion items infrastructure, web fees, items meeting statutory / regulatory requirements • Major advertising campaigns Variable marketing costs: • Commissions for sales staff or incentives for consumers or distribution channels • Ad spend bought on a pay-per-click basis

46. Online marketing is not free

47. Trends in marketing spends • Cost of many media is decreasing – competition in print/radio • Increased proportions of budgets are spent online - April 2013: Ad spend in traditional media continues to fall by 6.2pc, digital advertising in Ireland has increased by 12.3pc to surpass €150m for the first time -Internet Advertising Bureau (IAB). • Increased staffing requirements to manage labour-intensive channels such as online content creation / social media management • Increased use of specialists • Printers going out of business

48. Measuring marketing ROI • Establishing KPIs at the outset • Establishing marketing indicators - digital analytics • Brand and goodwill on the balance sheet • Iterative process – huge data, requires responsiveness

49. Marketing budget – case study personal investment advisors “We believe the following factors should be taken into account by PIA in setting its marketing budget: • What the growth objectives are – the higher the targets the greater the spend required to achieve these targets, all other things being equal • Where the growth is targeted to come from – it will be much easier and cheaper to sell new services to existing customers than to gain new customers (although these will always be needed to some extent) – but this will provide growth only if there is sufficient scope in the existing customer base • Availability of resources – it is obviously easier to invest in marketing when the firm is profitable, and PIA has had a difficult year last year • What competitors are doing – although his should not be the dominant factor by any means it is an important consideration • Perception of opportunities – if customers are very risk averse this may not be the time to invest heavily in products with a higher risk profile “

50. Key take-aways • Marketing needs to be integrally factored into the budget of an enterprise – properly casted and not “guesstimated” • Online marketing is not free • Marketing can report on KPIs and also marketing indicators • Not investing in marketing can be at least as costly as any marketing activities themselves!