TE - III - M - 0 HUMBOLDT-UNIVERSITÄT ZU BERLIN INSTITUT FÜR INFORMATIK TECHNICAL ENTREPRENEURSHIP Vorlesung 3 THE MARKETING Wintersemester 1999 Leitung: Prof. Dr. Miroslaw Malek Betreuer: Peter K. Ibach TECHNISCHE UNIVERSITÄT BERLIN INSTITUT FÜR INFORMATIK

TE - III - M - 1 THE MARKETING The Marketing Concept Customer and Marketing Orientation Market Opportunity Analysis (MOA) Sources of Information for MOA Consumer Profiles Marketing Implications of Product Characteristics Profile of Competitors Marketing Mix Variables Marketing Channels Promotion Mix Tools Promotion Tools Strengths and Weaknesses Advantages and Disadvantages of Major Advertising Media

TE - III - M - 2 THE MARKETING CONCEPT Customer Orientation Customer Needs & Wants Organizational Integration Success Goal Achievement

TE - III - M - 3 INDICATORS OF CUSTOMER AND MARKETING ORIENTATION 1) What information do you carefully collect about the exact needs of your customer ? 2) Could you consider custom designing your services or products for smaller groups of customers ? How ? 3)Are your (nonsales) employees specifically trained to represent your company to customers ? How ? 4) Are customers contacted after the sale to determine their level of satisfaction ? How ?

TE - III - M - 4 INDICATORS OF CUSTOMER AND MARKETING ORIENTATION (continued) 5) How do you convert unsatisfied customers to satisfied customers ? Do you have any strategy? 6)Is your top marketer in the company a top-level, equal team member ? 7) To what extent do you build your strategies around an in-depth understanding of your customers ? 8) To what extent are activities of different people (or departments) coordinated to ensure customer satisfaction ?

TE - III - M - 5 MARKETING MANAGEMENT AND ENTREPRENEURSHIP Risk takingCreativity Creating value Venture idea identification, innovation, and exploiting opportunity Business plan development Assembling/ integrating resources Team building Managing growth Organizational mission Market opportunity analysis Marketing strategy Target market Marketing objectives Marketing program Environmental scanning Implementation/control

TE - III - M - 6 THE FIVE STEPS TO ANALYZING MARKET OPPORTUNITY 1. Identify the business environmental forces. –Economic conditions and trends –Legal and regulatory situations and trends –Technological positioning and trends (state of the art; related R&D) –Relevant social changes –Natural environment (shortages ? vulnerabilities ?) 2. Describe the industry and its outlook. –Type of industry –Size -now and in 3-5 years –Types of marketing practices –Major trends –Implications for opportunity

TE - III - M - 7 THE FIVE STEPS TO ANALYZING MARKET OPPORTUNITY (continued) 3. Analyze the key competitors –Product description –Market positioning (relative strength and weaknesses, as seen by customers) –Market practices: channels, pricing, promotion, service –Estimated market share (if relevant) –Reactions to competition –Implications for opportunity

TE - III - M - 8 THE FIVE STEPS TO ANALYZING MARKET OPPORTUNITY (continued) 4. Create a target market profile. –Levels: generic needs, product type, specific brands –End-user focus; also channel members –Targeted customer profiles –Who are my potential customers ? –What are they like as consumers/businesspeople –How do they decide to buy / not buy ? –Importance of different product attributes ? –What outside influences affect buying decisions? –Implications for opportunity ? 5. Set sales projections –As many formal or intuitive approaches as possible –Comparison of results –Go/ no go

TE - III - M - 9 SOURCES OF INFORMATION FOR MARKET OPPORTUNITY ANALYSIS (MOAS) Published Sources –Periodicals and newspapers –Trade association reports –Standardized information service reports –Government documents –Company reports Personal observation –Of customers –Of competitors –Of macroenvironmental influences

TE - III - M - 10 SOURCES OF INFORMATION FOR MARKET OPPORTUNITY ANALYSIS (MOAS) (continued) Interviews with experts –Managers of suppliers –Managers of trade companies –Managers of trade associations –Consultants –Salespersons Primary marketing research –Cross-sectional surveys –Longitudinal panels –Experiments

TE - III - M - 11 TYPES OF ADOPTERS BY ADOPTION TIME REQUIRED Proportion of eventual adopters 2 1/2% 13 1/2% 34% 16 % Innovators Early adopters Early majority Late majority Laggards Time to adoption decision

TE - III - M - 12 COMPARATIVE PROFILES OF THE CONSUMER INNOVATOR AND THE LATER ADOPTER

TE - III - M - 13 COMPARATIVE PROFILES OF THE CONSUMER INNOVATOR AND THE LATER ADOPTER (contin.)

TE - III - M - 14 MARKETING IMPLICATIONS OF IMPORTANT PRODUCT VENTURE CHARACTERISTICS

TE - III - M - 15 MARKETING IMPLICATIONS OF IMPORTANT PRODUCT VENTURE CHARACTERISTICS (contin.)

TE - III - M - 16 Factors influencing the marketing strategy of key competitors Profile of Competitors Mission and business objectives Market position and sales trends Management capabilities and limitations Target market strategies Marketing objectives Marketing strategies and tactics

TE - III - M - 17 MARKETING MIX VARIABLES

TE - III - M - 18 CUSTOMER PERCEPTION HIERARCHY

TE - III - M - 19 NEW PRODUCT DEVELOPMENT PROCESS Business Strategy Idea generation Idea screening and evaluation Business analysis Product/service development Product/service testing Market entry

TE - III - M - 20 ALTERNATIVE MARKETING CHANNELS

TE - III - M - 21 Channel design decisions and decision criteria Identification of channel alternatives Evaluation and selection of channel(s) to be used Selection of channel participants Design stagesDecision criteria Intensity of distribution Access to end-user Prevailing distribution practices Necessary activities and functions Revenue-cost analysis Time horizon for development Control considerations Legal constraints Channel availability Market coverage Capability Intermediarys needs Functions provided Availability

TE - III - M - 22 PROMOTION MIX TOOLS Advertising Print ads Broadcast ads Billboard ads Packaging logos and information Personal selling In-person sales presentations Telemarketing Sales promotion Games, contests Free samples Trade shows Couponing Trading stamps Price promotion Signs and displays Publicity Print media news stories Broadcast media news stories Annual reports Speeches by employees The promotion mix

TE - III - M - 23 PROMOTION TOOLS STRENGTHS AND WEAKNESSES Low Very low Very high Poor to good GoodModerate Very good Poor to good Poor Poor to good Very good None Low to moderate Very good Low High Moderate to high Advertising Sales promotion Publicity Personal selling Criteria Cost per Audience member Confined to target markets Deliver a Complicated message Interchange with audiences Credibility

TE - III - M - 24 ADVANTAGES AND DISADVANTAGES OF MAJOR ADVERTISING MEDIA

TE - III - M - 25 ADVANTAGES AND DISADVANTAGES OF MAJOR ADVERTISING MEDIA (continued)

TE - III - M - 26 CONDITIONS SUGGESTING PERSONAL SELLING AS A MAJOR ELEMENT OF THE MARKETING MIX

TE - III - M - 27 CONDITIONS SUGGESTING PERSONAL SELLING AS A MAJOR ELEMENT OF THE MARKETING MIX (continued).