Developing Marketing Strategies Ian Mejia 2009 Redfield College

Syllabus Points Covered developing marketing strategies • market segmentation and product/service differentiation • product and service – positioning – branding – packaging • price including pricing methods — cost, market and competition-based – pricing strategies/tactics — skimming, penetration, loss leaders, price points – price and quality interaction • promotion – elements of the promotion mix — personal selling, advertising, below-the-line promotions, public relations – the communication process including opinion leaders and word of mouth • place/distribution – distribution channels and reasons for intermediaries – channel choice including intensive, selective, exclusive – physical distribution issues including transport, warehousing, inventory • environmental effects on distribution — technology, local government

Market Segmentation Market segmentation is the process of identifying niche markets within a mass market. Market segmentation is effective because it gathers people with similar characteristics and allows a business to be more specific with its strategies.

Markets can be identified through Demographic factors Geographical factors Psychographic factors Behavioural factors

Demographics Age Sex Education Income Occupation Religion

Geographical Factors Where do customers make purchase decisions? Seasonal variations? Climate, conditions etc. Type of living conditions City / Suburbs / Rural

Psychographic Why does a customer buy a product or service? Lifestyle characteristics Personality types Self perception Beliefs Any personal influence on a buying decision.

Behavioural Factors What is the purchase situation when making a purchase? Customer loyalty Usage rates (how often) Purchase occasion (what is occurring during the purchase)

Product Differentiation Product differentiation is a marketing strategy designed to reinforce the distinctions between products intended for a similar market segment. This occurs to: -tailor a base product. -differentiate from competition.

Tailoring a Base Product This allows businesses to penetrate a range of markets and allows customers to purchase a product more suited to them. Extras on cars, i-pods, mobile phone accessories

Differing from Competition Make one product seem superior or better at meeting the needs of a customer. May increase the market share of a business May allow a premium price to be charged for a good or service, justified by a superior product.

The Four P’s. Product Price Promotion Place

Product Positioning -Positioning is a marketing term that describes how customers percieve a product in relation to a similar product in a market. -Products are positioned to tap in to target markets to create value in a consumers mind.

Perceptual Maps

Effective Positioning Determine What do customers think of the product now? What does the business want consumers to think about the product? Which differentiation strategy will elevate the consumers’ current perceptions to the desired perception.

Positioning Strategies Product Users – emphasis on the type of user, someone they can relate to or emulate to. Product Usage – emphasis on the benefits of usage or how it can be used Competition – positioning in relation to competitors