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The Pan Paradigm of Business

The Pan Paradigm of Business. General Law of Business. The mirror image: Business offerings ≥ Market receipts in value assessment relative to individuals’ need, want, and demand The transaction process:

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The Pan Paradigm of Business

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  1. The Pan Paradigm of Business

  2. General Law of Business • The mirror image: • Business offerings ≥ Market receipts in value assessment relative to individuals’ need, want, and demand • The transaction process: • Something must be exchanged between parties at two sides for profitability to stay in business

  3. Classic Principles • Business Offerings • Product • Ideas • Organizations • Persons • Destination/location • Market • Consumer • Industrial/Business • Financial • Commodities • Technology

  4. Product • Goods • Services • Market • Demographic • Psychographic • Behavioral • Socio-Economic Status • Combined groupings

  5. Product (design+engineering) • Branding • Functions • Process-how to • Properties • Attributes • Features • Utilitarian functions • Line • Mix • Width • Length • Depth • Life cycle • Intro-growth-maturity-decline • Human • Brand Identification • Brand equity formation • Brand status association • Benefits • Need • Biological • Psychological • Social • Personal developmental • Want in form of • Family • Traditional heritage • Cultural conformance • Personal determinants • Demand • Aggregated wants supported by purchasing power

  6. Advanced Views • Brand Evaluation • HI (M) • O(M) • F(A) • C(A) • L(E) • Hi, mom, fa-ca-le with • Market Development • E • L • (Preferred) • L • E • I • I • Elleii

  7. Brand Evaluation • Host v. Member • How the host brand incubates member brands? • Origin v. Manufacturing • How the brand origin interacts with effect of country/place of manufacturing? • Focal Brand v. Brand Allies • How a brand(s) can shadow or augment the brand in focus of evaluations? • Chief v. Associated Brands • How strong the association can be? • Locus Brand Core v. Brand Extensions • How far it can go on a sliding scale of effect and control? • Hi, mom, fa-ca-le with • Market Development • Existing • Loyal • Those who are committed • Preferred • Those who preferred yours over competing one but with a “catch” • Leisure • Those who browse around without a brand preference • Extended(prospective) • Informed • Those who have been exposed or informed with the brand at issue • Innocent • Those who have never been exposed with a particular brand at issues Elleii

  8. Combined Strategies from Decisions of • Product • Price • Promotion (IMC) • Place (Distribution) • Target at Classic Segmentation by: • Demographic • Psychographic • Behavioral • SES, etc

  9. To position • A product distinguishable in the mind of intended market (customers and consumers) relative to its quality in the price-value assessment • To achieve • Loyal consumers through stages from their innocence

  10. The Pan Price-Value Equation Price = TC + “ME” Unit TC: total cost = VC + FC ME : marketing effort including branding, promotions, etc Unit: quantity of product Value = Q + “BE” Unit Q: quality - real + perceived relative to many such real self, ideal self, etc BE: Brand Equity Unit: quantity of product

  11. Transaction occurs when Business side Price = Utilities Form Time Place Ownership Market side Value Benefits Need Want Demand

  12. Business Side • Product decisions • Price decisions • Promotion decisions • Place decisions • Business strategies

  13. Product Analysis Product-anything a consumer acquires or might acquire to meet an emerged need. *The term Need is depicted as a state of disequilibrium between the actual and desired self. i.e., Necessities, wants, and desires. This includes: • Attributes-main or core qualities of product. • Features- additional, distinct aspects of product. • Utilitarian Functions- practical, useful, and functional properties of product.

  14. Product Analysis continue The product branding process The product branding consideration The product engineering process The product positioning

  15. The Product Branding Process • Brand Engineering should include • Differentiation against competitors • Fit with desired human personality traits • Possession with strong associations • Arousal of stimulating emotions • Creation of Brand Equity-value beyond the real value of product • Visualization of desired Brand Image

  16. The Branding Considerations • Fanciful or Arbitrary • Aspirin • Coke • Google • Yumlings • Suggestive • Yumlings • Fish-Fri v. Chick-Fri

  17. Descriptive • Chicken Soup • …. • Generic • Aspirin • Coke • Google ≠ Yahoo

  18. “Secondary Meaning” • The “Swinging Clock Pendulum” rule without trademark registration • The auto protection with trademark registration

  19. The Product Engineering Process • Achieve tangible differentiation against competitors • Achieve excellence in quality (real/actual and perceived

  20. Google v. Baidu in China – Search engines • Google • 30% of Chinese market share (11.2%?) • $90 m/$200m in sales in 2008 (google.cn/CHN) in comparison of $22 billion worldwide

  21. Baidu • 60-60% of Chinese market share • $381 m in sales in 2008 and two digits of percentage increase in 2009 by quarter reports

  22. Google -- • “Grain’s Song” in Chinese name • The name "Google" originated from a misspelling of the word "googol“ in English which refers to 10100, the number represented by a 1 followed by one hundred zeros, reflective of the product itself

  23. Baidu – • Many people have asked about the meaning of Baidu in English for Chinese. • 'Baidu' was inspired by a poem written more than 800 years ago during the Song Dynasty. The poem compared the search for a retreating beauty amid chaotic glamour with the search for one's dream while confronted by life's many obstacles. • '...hundreds and thousands of times, for her I searched in chaos, suddenly, I turned by chance, to where the lights were waning, and there she stood.' (Chinese: 众里寻他千百度，蓦然回首，那人却在灯火阑珊处;) • Baidu, whose literal meaning is hundreds of times, represents persistent search for the ideal.

  24. Sham Generic or Infringement (Pan, 2010) • Product • Every element of a claim • Is literally infringed, or • Is infringed under the doctrine of equivalents • Trademark • Likelihood of consumer confusion • Strength of mark • Proximity of the goods • Similarity of the marks • Evidence of actual confusion • Marketing channel used • Types of goods and purchaser care • Intent • Likelihood of expansion • Dilution • Kodak bicycles, or Buick Aspirin , ..

  25. Price Analysis Price- the amount of money one must pay to obtain the right to use the product. Price should be determined by the following factors: • Fixed and variable costs • Competition • Company objectives • Proposed positioning strategies • Target group and willingness to pay

  26. Pricing Strategies Based on the company’s objectives. Examples include: • Penetrating Pricing • Bundle Pricing • Skimming Pricing • Psychological Pricing • Competition Pricing • Premium Pricing • Optional Pricing

  27. Promotion Analysis Promotion- the communication of information of a product to generate a positive consumer response (sales). Decisions concerning promotions include: • Promotional strategy (push, pull, etc.) • Advertising • Personal selling & sales force • Sales promotions • Public relations & publicity • Marketing communications budget

  28. Place Analysis Place (Distribution)- is having the product available where target customers can buy it. Some examples of distribution decisions include:

  29. Distribution channels • Market coverage (inclusive, selective, or exclusive distribution) • Specific channel members • Inventory management • Warehousing • Distribution centers • Order processing • Transportation • Reverse logistics • Backward and Forward Integration

  30. Market Analysis Targeting a market involves research to determine the changing trends of consumer behavior. This is done through researching: Demographics Psychological Aspects Behavioral Aspects Socio-economic Status By ELLEII

  31. Marketing Analysis Demographics- selected population characteristics. Examples: location, race, age income, education, occupation, etc. Demographics determine certain cultural factors that will affect not only consumer behavior but also the marketing strategy of a company.

  32. Marketing Analysis Psychological Aspects-studies the mind and behavior of individuals. Refers to the mental and behavioral constitution of a person. By researching a target market’s different perceptions, thoughts, values, and beliefs a better understanding of what the marketing strategy must accommodate with is revealed. This area of aspects can also reveal where to position a product for the greatest success.

  33. Marketing Analysis Behavioral Aspects- refer to how a person conducts his or herself in specific situations for observable conduct only, such as frequency of purchase or usage under the effect of a given stimuli or situation. This is pertinent to developing a solid marketing strategy. Such factors can be pinpointed as: • Celebrity Endorsers • Brand personality • Emotions • Imagery

  34. Marketing Analysis Socio-economic status- divides population into classes according to income, occupation, education, and ethnic background. Example of scales: Lower-middle, Middle, Upper-Middle, and Upper levels. This determines the appropriate location, pricing, and themes that will be successful in marketing a product to its niche.

  35. Marketing Analysis There are four stages through which persons in a target market have to be developed into a business market share. They are as follows: ELLII – Preferred between L and L

  36. Innocent in Extended Market • Individuals that must have no knowledge of a brand coming to a marketplace

  37. Informed in Extended Market • Individuals that must be made aware of the brand to purchase for the first time.

  38. Leisured in Existing Market Those who may or may not recognize the brand and make non-committal or non-habitual purchases

  39. Preferred in Existing Market Those who prefer the brand over other competing ones and will purchase it continually unless competitor product has a distinguishable advantage such as special price discount, new feature, or the preferred one is currently out of stock.

  40. Loyal in Existing Market Those who are brand loyal and will purchase ONLY that brand, even if brand is out of stock.

  41. Marketing Analysis • The relationships between need, want, and demand • How does a need “emerge” • Where does a need come from? • Is need or want a universal? • Can we do business for a demand without affordability?

  42. Need • an emerged state of disequilibrium from what has been maintained as a homeostasis in humans; or a result of being out of the Zone of Comfort in humans, it comes from in the fields of biological, psychological, social, and economic perspective, etc. • Desire - a feeling that accompanies an unsatisfied state. A wish, craving, or lust.

  43. Want – a form of need taken in the desirable feeling that is determined by individual preference shaped by how one has been “formulated” from his or her development, family, cultural, ethnic, peer influences, or personal limitations.

  44. Demand the aggregated want or desire to possess a good or service with purchasing power (money or affordability) necessary to make a legal transaction for the good or service.

  45. Price-Demand Elasticity The demand curve displays the relationship between the price of the product and the amount of product consumers want to buy. This relationship is indirect because as prices go up, people buy less of that particular product. It is referred to as the Law of Demand.

  46. Continue, … During times of recession and depression, the demand of products in general declines; however it is the “wants” that can be suppressed or delayed far more than the “needs” that could have emerged The relationship of Demand/Need/Want should be “mirrored” the relationship of the product’s attributes, features, and utilitarian features from the Business side.

  47. The Relationship of Pan Price-Value Equation On the business side, price can be determined by: Total Cost/Quantity plus “marketing effort.” This will present a minimum dollar value to the market side because price will never be less that the expenses accrued from producing a product unless other economic or strategic considerations are factored.

  48. On the market side, value can be determined by Quality plus Brand Equity. Quality can be viewed and verified through usage in the form of real or perceived one in this equation.

  49. The Relationship of Competing Marketing Offerings This relationship can be depicted by use of the product positioning method. Product positioning- an image of the product or brand in the consumer’s mind relative to competing products and brands.

  50. Relationship of Competing Marketing Offerings continued Through the use of a perceptual map, brands can position themselves in a market with competitors to form their own niche of the market and create a successful brand or product.

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