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Marketing Concepts

Marketing Concepts

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Marketing Concepts

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  1. Marketing Concepts

  2. Workbook – DO NOW • Page 254 – Tesco is Market leader in Thailand. • Question 1,2,3 (15 mins)

  3. Adding Value • Marketing is the added value on most products, the customers will pay for something the perceive is of better quality.

  4. How Companies Add Value • Retail environment improvements i.e. a beauty salon or hairdresser needs to make the customer feel welcome, magazines, comfortable waiting area, TV etc • Packaging creates a POD i.e. Chocolate • Promotion must have brand Ie Coke, Levis • Create a USP – differentiates your product from competitors.

  5. USP + Product Differentiation • USP – the feature of the product that differentiates it from the competitor. • Product Differentiation – Making the product stand out from competitors in the consumers perception.

  6. Sink Water Fountain Golf Club and Weedwacker

  7. Mass Marketing • Selling product to the whole market without targeting anyone specifically. • This isn't very common as it means there is no real direction for your product line. • What Companies would you consider use mass marketing?

  8. Advantages of Mass Marketing • Small Market Niches don’t allow economies of scale to be achieved. Mass Marketing firms will have lower costs of production. • Mass Market strategies run fewer risks than Niche Market. Ie if tastes and preferences change in your niche this can result in a loss of sales.

  9. Niche Marketing • Identifying and exploiting a small segment of a larger market by developing products to suit it. • What companies might use Niche Marketing as there approach?

  10. Advantages of Niche Marketing • Small Firms can survive and thrive in markets that are dominated by large firms. • Sometimes you can make high profits because of a lack of competitors within the market. • Niche market products can be used by large firms to create status and image that their mass market products lack.

  11. Market Segmentation • Market segment – A sub group of consumers within a market in which consumers have similar characteristics. • Market Segmentation – identifying different segments within a market and targeting different products or services to them. • This approach is very normal within the business world, it requires businesses really understanding consumers and the groups within there market.

  12. Market Segmentation • What Segments of the market are the following products targeted at?

  13. Market Segmentation • Marketers need to identify different consumer groups that are most likely to buy there products. • This leads to a consumer profile, so the marketing can be more effective in terms of promotion, design and price. • Consumer profiles include – age, income level, location, gender and social class.

  14. Market Segmentation • There are three commonly used basis for segmentation • Geographic Differences • Demographic Differences • Psychographic Differences

  15. Geographic differences • Consumer tastes may vary between different areas so it may be appropriate to offer different products and market them in location specific ways. • Different countries have different cultures so some forms of advertising are not going to be acceptable in different countries. • Before entering a new market extensive research needs to be done to avoid a loss of sales from a disrespect of local laws or culture.

  16. Examples • Frank Perdue's chicken slogan, "it takes a strong man to make a tender chicken" was translated into Spanish as "it takes an aroused man to make a chicken affectionate". • The Coca-Cola name in China was first read as "Ke-kou-ke-la", meaning "Bite the wax tadpole" or "female horse stuffed with wax", depending on the dialect. Coke then researched 40,000 characters to find a phonetic equivalent "ko-ou-ko-le", translating into "happiness in the mouth".

  17. Examples • We all know about GM's Chevy Nova meaning "it won't go" in Spanish markets, but did you know that Ford had a similar problem in Brazil with the Pinto? Pinto was Brazilian slang for " tiny male genitals". Ford renamed the automobile Corcel, meaning "horse".

  18. Demographic Differences • The most common use for segmentation. • Demography is the study of the population data, and identifies the following characteristics. -Age -Income -Sex -Religion -Ethnicity - Social Class • This helps organizations become more effective with there marketing.

  19. Demographic Differences • Socio economic groups or social class include – Upper Middle class, Middle Class, Lower Middle class, working class. • Your class often determines what you would spend your income on, so the higher the class the more likely to spend money on luxury goods.

  20. Class System • Identify two products that each different class might buy. - Upper Class - Middle Class - Lower Middle Class - Working Class

  21. Acronyms for different Groups • DINKY – double income no kids yet • NILK – no income lots of kids • WOOF – well off older folk • SIN BAD – Single Income, No Boyfriend and Absolutely Desperate • GLAM – Greying, Leisured, Affluent, Middle-aged • YUPPIE – Young Urban Professional

  22. Psychographic factors • Differences in consumers lifestyles, personalities, values and attitudes. These can be influenced by the consumers social class. • I.e. consumers different attitudes to ethical business, private education and organic food

  23. Psychographic Factors • How Might your Life Style affect your purchasing decisions? • What about your personality?