Principles of marketing: Lecture 8

MGT301
Principles of Marketing
Lecture­8


Summary
of  
Lecture­7




Portfolio Analysis



Marketing Process


20%­
18%­
16%­
14%­
12%­
10%­
  8%­
  6%­
  4%­
  2%­
    0

Stars

4

5

Question marks

3

?

?2

?

Market growth rate

The Boston Consulting Group’s Growth­
Share Matrix

?

1

Dogs

Cash cow

8

6

7

10x        4x     2x  1.5x     1x   .5x .4x .3x .2x .1x
Relative market share


Product/Market Expansion Grid
Current
products

Current
markets

New
markets

Marketpenetration
strategy
Marketdevelopment
strategy

New
products

Productdevelopment
strategy

(Diversification

strategy)


Marketing Strategy Planning Process


Customers
Needs and other
Segmenting
Dimensions

Company
Mission, Objectives,
& Resources

Competitors
Current &
Prospective


Customers
Needs and other
Segmenting
Dimensions

Company
Mission, Objectives,
& Resources

S.

W
.
O.
T.

Competitors
Current &
Prospective

External Market Environment


Customers

Needs and other
Segmenting
Dimensions

Targeting &
Segmentation

Company
Mission, Objectives,
& Resources

S.
W.
O.
T.

Competitors
Current &
Prospective

External Market Environment

Positioning &
Differentiation


Narrowing down to focused strategy with quantitative
and qualitative screening criteria
Customers
Needs and other
Segmenting
Dimensions

Targeting &
Segmentation

Company
Mission, Objectives,
& Resources

S.
W.
O.
T.

Positioning &

Differentiation

Competitors
Current &
Prospective

External Market Environment


Today’s Topics


Marketing Process





 Analyzing marketing opportunities
 Selecting target markets
 Developing the marketing Mix
 Managing the marketing effort


DemographicEconomic
Environment

g
tin
ke ol

ar tr
M Con

PoliticalLegal
Environment

Target
Price
Consumers
Promotion

Competitors

Publics

Im Ma
pl rk
em et
en ing
ta
t io
n

M
An ark
al eti
ys ng
is

Place

Product

g
tin g
ke in
ar n
M lan
P

Suppliers

TechnologicalNatural
Environment

Marketing
Intermediaries

SocialCultural
Environment


 Analyzing marketing opportunities


Situation Analysis
The Three Cs
Customers
••Industry
Industry

Structure
Structure
Analysis
Analysis
(entry/exit
(entry/exit
barriers,
barriers,buyers,
buyers,
sellers,
sellers,
substitutes)
substitutes)
••Competitor
Competitor
Response
Response
Profiles
Profiles
(capabilities,
(capabilities,
current
currentand
andfuture
future
actions)
actions)

Company

Competitors

••Market
MarketPotential
Potential
(size,
(size,growth
growthrate)
rate)
••Customer
Customer
Behavior
Behavior(wants
(wants
and
andneeds,
needs,
segmentation,
segmentation,
price
pricesensitivity)
sensitivity)
••Economic
Economic
Analysis
Analysis(costs,
(costs,
break-even,
break-even,
profitability)

profitability)
••Company
CompanyFit
Fit
(strengths,
(strengths,
weaknesses,
weaknesses,
resources,
resources,culture,
culture,




changing environment
– opportunities and threats



changing firm situation
– relative strengths and weaknesses



Fit ­ match opportunities with firm’s objectives and resources 
(strengths)



Market Information System


The Marketing
Information System
Marketing
managers

Marketing Information System
Developing information

Analysis
Planning

Assessing
information
needs

Internal
records

Marketing
intelligence

Implementation

Marketing
environment
Test
markets

Marketing
channels
Competitors

Control
Distributing
information

Marketing
decision
support
analysis

Marketing
research

Marketing decisions and communication

Publics
Macroenvironment
forces


 Selecting Target Markets






Firm cannot satisfy everyone
– mass marketing
Segment total market
– market segmentation
Target markets
– target marketing
– niche marketing


Developing the Marketing Mix


Price

Product

Amount of money
that consumers 
have to pay to 
Obtain the product

“Goods­and­service”
combination that a 
company offers a
target market
Target
Customers
Intended
Positioning
Activities that 

persuade target 
customers to buy
the product
Promotion

Company activities
that make the 
product available

Place


Marketing
Marketing Mix
Mix
Product

Place

Target
Target Market
Market

Product Variety
Quality

Channels
Coverage

Design

Assortments

Features

Locations

Brand Name

Price

Packaging

List Price

Promotion

Sizes

Discounts

Sales Promotion

Services

Allowances

Advertising

Warranties

Payment Period

Sales Force

Returns

Credit Terms

Public Relations
Direct Marketing

Inventory
Transport


The 4 P’s & 4C’s of the Marketing Mix


4 P’s
4 P’s

––Product
Product
––Price
Price
––Place
Place
––Promotion
Promotion

4 C’s
4 C’s

Customer Solution
–– Customer Solution
Customer Cost
–– Customer Cost
Convenience
–– Convenience
Communication
–– Communication


 Managing the marketing effort


Managing the Marketing Efforts
Marketing
Marketing Analysis
Analysis of
of Company’s
Company’s Situation
Situation

Marketing
Marketing
Planning
Planning
Develop

DevelopStrategic
Strategic
Plans
Plans
Develop
Develop
Marketing
Marketing
Plans
Plans

Marketing
Marketing
Implementation
Implementation
Carry
CarryOut
Out
The
The
Plans
Plans

Control
Measure
Results
Evaluate
Results
Take
Corrective

Action