The Role of IMC in the Marketing Process © 2007 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin

Product decisions Pricing decisions Channel-of- distribution decisions Product decisions Pricing decisions Channel-of- distribution decisions Opportunity analysis Competitive analysis Target marketing Identifying markets Market segmentation Selecting a target market Positioning through marketing strategies Promotional decisions Advertising Direct marketing Interactive marketing Sales promotion Publicity and public relations Personal selling Ultimate consumer Consumers Businesses Promotion to final buyer Opportunity analysis Competitive analysis Target marketing Identifying markets Market segmentation Selecting a target market Positioning through marketing strategies Promotional decisions Advertising Direct marketing Interactive marketing Sales promotion Publicity and public relations Personal selling Ultimate consumer Consumers Businesses Marketing and Promotions Process Model © 2007 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Resellers Promotion to trade Internet/ Interactive Purchase

Marketing to a Lifestyle © 2007 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin

Take marketing actions to reach target segments. Select the product segments toward which the firm directs its marketing actions. Develop a market/product grid to relate the market segments to the firm’s products and actions. Find ways to group marketing actions - usually the products offered - available to the organization. Find ways to group consumers according to their needs. Select the product segments toward which the firm directs its marketing actions. Develop a market/product grid to relate the market segments to the firm’s products and actions. Find ways to group marketing actions - usually the products offered - available to the organization. Find ways to group consumers according to their needs. The Marketing Segmentation Process © 2007 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin

Behavior Benefits Outlets Benefits Outlets Behavior Psychographic Geographic Demographic Psychographic Demographic Geographic Bases for Segmentation Customer Characteristics Customer Characteristics Socioeconomic Buying Situation Buying Situation Usage Socioeconomic © 2007 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Awareness

Segmentation by Gender Focus on females’ fashion Information source ： Giordano

Segmentation by Age Focus on kids Information source ： Giordano

Segmentation by Age LEGO SEGMENTS small kids 0-18mths –0-18 mths PRIMO baby, stack and learn –18-36 mths PRIMO motion, basic themes boys –3-5 yrsd DUPLO basic, themes, toolo, train/SYSTEM freestyle, town junior –5-9 years SYSTEM themes/TECHNIC starter –9+ SYSTEM model team, TECHNIC model team, advanced, cybermaster girls –3-5 years DUPLO basic, themes SYSTEM freestyle, town junior, LEGO scala –5-9 yrs SYSTEMS, belville, themes, LEGO scala SOURCE: productsbyproductline.asp

Segmentation by Lifestyles This ad illustrates the way that products like cars are tightly integrated into consumers ’ lifestyles, along with leisure activities, travel, music, and so on.

Segmentation by Motivation This ad for exercise shows men a desired state (as dictated by contemporary Western culture), and suggests a solution (purchase of equipment) to attain it.

Segmentation by Benefits Lava soap lays out the options and invites us to choose the solution.

Segmentation by Occasions (Time Poverty) Time poverty is creating opportunities for many new products (like portable soups) that let people multitask.

Positioning through marketing strategies Selecting market to target Determining market segmentation Identify markets with unfulfilled needs Selecting market to target Determining market segmentation Identify markets with unfulfilled needs The Target Marketing Process © 2007 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin

Based on consumer characteristics, companies categorize the market and provide products to meet consumers ’ needs. EX: Shampoo Target Marketing Anti-dandruff Oily hair Fine hair Color-treated hair Target market

Differentiated Marketing Need for beauty Working women Need for ballet dancers Need for running joggers Target Marketing

Concentrated marketing Working women Dancers Foot ball players Limited resources Concentrate on a secondary market Such secondary market: niche market Target Marketing

Individual marketing –customization (e.g., Bear Factory) Target Marketing

Mass customization –Characteristics Needs high technology to customize consumer needs Expensive goods Longer waiting time for customers to get the products Target Marketing

Definition of Positioning Positioning Consumers can differentiate a company’s product with others. The largest auction web site positioning position

What position do we have now? Do we have the money to do the job? What position do we want to own? From whom must we win this position? Do we have the tenacity to stay with it? Do we have the money to do the job? From whom must we win this position? What position do we want to own? What position do we have now? Does our creative strategy match it? Developing a Positioning Strategy © 2007 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin The Position The Position

Why to Position a Product? –Differentiation –Based on consumers ’ subjective judgments –Repositioning when the marketing environments change Positioning

Good Positioning “..positioning is not what you do to a product. Positioning is what you do to the mind of the prospect ” (Ries and Trout) simple message credible benefits consistency

Product Positioning This ad for Sunkist lemon juice attempts to establish a new category for the product by repositioning it as a salt substitute.

By Attributes and Benefits? By Price or Quality? By Use or Application? By Product Class? By Product User? By Competitor? By Cultural Symbols? By Attributes and Benefits? By Price or Quality? By Use or Application? By Product Class? By Product User? By Competitor? Positioning Strategies © 2007 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin How should we position?

Cultural Symbols Can Differentiate Brands © 2007 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin

Advertising Develops Brand Images © 2007 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin

Branding and Packaging Work Closely Together © 2007 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Product Decisions BRANDING Brand name commun- icates attributes and meaning Advertising creates and maintains brand equity Packaging has become increasingly important It’s often customers’ first exposure to product PACKAGING BRANDING

A Package Is More than a Container © 2007 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin

Price must be consistent with perceptions of the product Higher prices communicate higher product quality Lower prices reflect bargain or “value” perceptions Price, advertising and distribution be unified in identifying the product position Price must be consistent with perceptions of the product Higher prices communicate higher product quality Lower prices reflect bargain or “value” perceptions Price, advertising and distribution must be unified in identifying the product position Pricing Must Be Coordinated with Other Factors © 2007 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Pricing Considerations Pricing Considerations A product positioned as high quality while carrying a lower price than competitors will confuse customers

Some Products Compete on Price – Others Compete on Quality © 2007 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin

Selecting Managing Motivating Selecting Managing Distribution is a Vital Link in the Chain © 2007 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Distribution Channel Decisions Distribution Channel Decisions

The “Middleman” Can Play a Key Role © 2007 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Independent Channel Intermediaries Independent Channel Intermediaries Brokers Distributors Wholesalers Retailers Brokers Distributors Wholesalers

Point of sale displays, racks, stands Trade deals, special displays Dealer premiums, prizes, gifts Cooperative advertising deals Advertising materials, mats, inserts Push money or “spiffs" Collaterals, catalogs, manuals Point of sale displays, racks, stands Trade deals, special displays Dealer premiums, prizes, gifts Cooperative advertising deals Advertising materials, mats, inserts Push money or “spiffs" Collaterals, catalogs, manuals Promotion to Push Goods Through Channels © 2007 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin PUSH Company conventions, meetings

Sampling, free trial Cents-off promotions Cents-off coupons Combination offers Premiums or gifts Contests, sweepstakes Point-of-purchase Contests, sweepstakes Premiums or gifts Combination offers Cents-off coupons Cents-off promotions Sampling, free trial Promotion to Pull Goods Through Channels © 2007 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin PULL Trading stamps