MARKETING

Lecture 2. INTRODUCTION
CORE CONCEPTS OF MARKETING

NEEDS, WANTS, AND DEMANDS

EXAMPLE Examples
NEED  BASİC HUMAN REQUİREMENTS NEED NEED – FOOD (IS A MUST )
 STATE OF FELT DEPRIVATION FOOD

WANTS  NEEDS DİRECTED TO SPECİFİC OBJECTS WANT A WANT – PIZZA, BURGER, FRENCH FRY'S
 THE FORM OF NEEDS AS SHAPED BY BIG MAC (TRANSLATION OF A NEED BY OUR
CULTURE AND THE INDIVIDUAL EXPERIENCE )
DEMAND WANTS WHICH ARE BACKED BY BUYING BURGER ( TRANSLATION OF A WANT AS
S POWER PER OUR WILLINGNESS AND ABILITY TO
BUY )

DESIRE HAVE A BURGER IN A FIVE STAR HOTEL

MARKETING OFFERS: INCLUDING PRODUCTS, SERVICES AND EXPERIENCES

• MARKETING OFFERS – COMBINATION OF PRODUCTS, SERVICES, INFORMATION OR EXPERIENCES THAT SATISFY A
NEED OR WANT
o IT MAY INCLUDE: SERVICES, ACTIVITIES, PEOPLE, PLACES, INFORMATION OR IDEAS

VALUE AND SATISFACTION

• VALUE – CUSTOMERS FORM EXPECTATIONS REGARDING VALUE
• SATISFACTION – A SATISFIED CUSTOMER WILL BUY AGAIN AND TELL OTHERS ABOUT THEIR GOOD EXPERIENCE
EXCHANGE, TRANSACTIONS AND RELATIONSHIPS
• EXCHANGE – THE ACT OF OBTAINING A DESIRED OBJECT FROM SOMEONE BY OFFERING SOMETHING IN RETURN
• TRANSACTİON – TRADE OF VALUES BETWEEN TWO OR MORE PARTİES
o ONE EXCHANGE IS NOT THE GOAL, RELATIONSHIPS WITH SEVERAL EXCHANGES ARE THE GOAL
• RELATIONSHIPS – ARE BUILT THROUGH DELIVERING VALUE AND SATISFACTION

MARKETS
• MARKET – SET OF ACTUAL AND POTENTIAL BUYERS OF A PRODUCT • MARKETERS SEEK BUYERS THAT ARE
PROFITABLE
Types of Markets

THE MARKETING PROCESS

THE MARKETING PROCESS – A PROCESS OF ANALYZING THE OPPORTUNITIES IN THE MARKET, SELECTION OF THE
TARGET MARKETS, AND DEVELOPMENT OF THE MARKETING MIX AND MANAGEMENT OF THE MARKETING EFFORTS.

CUSTOMER RELATIONSHIP GROUPS

BUTTERFLIES
Butterflies - "MAKE THEM HAPPY WHILE THEY ARE INTERESTED, ENJOY THEM WHILE THEY LAST. AFTER THAT, CEASE
INVESTMENT IN THEM".
• ARE POTENTIALLY PROFITABLE BUT NOT LOYAL.
• THERE IS A GOOD FIT BETWEEN THE COMPANY'S OFFERINGS AND THEIR NEEDS.
• HOWEVER, LIKE REAL BUTTERFLIES, WE CAN ENJOY THEM FOR ONLY A SHORT WHILE AND THEN THEY ARE
GONE.
• EXAMPLE: SOMEONE THAT SUPPORTS MICROSOFT IN GENERAL BUT BUYS THE IPHONE SINCE IT HAPPENED TO
BE THE BEST AVAILABLE PHONE ON THE MARKET.
BARNACLES
BARNACLES – A CUSTOMER WHO BUYS A PACKET OF $0.50 SWEETS A FEW TIMES A WEEK FROM THE CONVENIENCE
BUT NOTHING ELSE MUCH
• MANAGEMENT FOR THESE CUSTOMERS WOULD BE TO TRY TO CROSS-SELL OR UP-SELL TO THEM, I.E.
ENCOURAGE THE CUSTOMERS TO BUY MORE.
• EXAMPLE: A CUSTOMER THAT BUYS ONE CUP OF COFFEE AT YOUR COFFEE SHOP, AND THEN COMES IN EVERY
DAY FOR THE NEXT MONTH TO USE YOUR FREE WIFI WITHOUT MAKING A PURCHASE

STRANGERS
STRANGERS – ARE CUSTOMERS WHO ARE NEITHER LOYAL NOR PROFITABLE
• BARGAIN HUNTERS WHO BARGAIN AND FOCUSED ON LOW-PRICED ITEM
• THE KEY TO DEALING WITH STRANGERS IS TO DIFFERENTIATE THEM QUICKLY, AND DO NOT INVEST IN THEM AT
ALL.
• EXAMPLE: AN INDIVIDUAL THAT OCCASIONALLY STOPS INTO A DRUG STORE TO BUY A STICK OF GUM, BUT
OTHERWISE NEVER USES THE STORE.
TRUE FRIENDS
TRUE FRIENDS – ARE CUSTOMERS WHO ARE HIGHLY PROFITABLE AND LOYAL
• EXAMPLE: THE APPLE FANATIC FAN WHO RUSHES TO BUY ANY NEW PRODUCT LAUNCHED BY HIS FAVORITE
COMPANY AND NOT BAULK AT THE HIGH COST OF HIS GADGETS COMPARED TO THOSE OF APPLE'S
COMPETITORS.
• OBVIOUSLY, BUSINESSES SHOULD TREASURE THESE CUSTOMERS, THEY SHOULD CONSTANTLY DELIGHT THEM,
NURTURE THEM AND RETAIN THEIR LOYALTY BY COMMUNICATING WITH THEM IN A REGULAR BUT YET
UNOBTRUSIVE MANNER.

DEVELOPMENT OF THE MARKETING PHILOSOPHIES

THE PRODUCTION CONCEPT

• FROM THE 1850S TO THE LATE 1920S
• COMPANIES FOCUS ON PRODUCTION CAPABILITIES
• CONSUMER DEMAND EXCEEDED SUPPLY
• EXAMPLE OF A PRODUCTION ORIENTATION COMPANY: THE ORIGINAL FORD MOTOR COMPANY.
• HENRY FORD MADE ONE MODEL IN ONE COLOR (BLACK), NO MATTER WHAT THE CONSUMER MIGHT WANT.
 POLAND 1989/ 1990 – CASE OF PRODUCTION ORIENTATION

THE PRODUCT CONCEPT

• CONSUMERS FAVOR PRODUCTS THAT OFFER THE MOST QUALITY, PERFORMANCE AND FEATURES
• THEREFORE THE ORGANIZATION SHOULD DEVOTE ITS ENERGY TO MAKING CONTINUOUS PRODUCT
IMPROVEMENTS
THE SELLING CONCEPT
• FROM THE 1930’S TO THE MID 1950’S
• FOCUS ON SELLING
• SUPPLY EXCEEDED CUSTOMER DEMAND
• IF A COMPANY HAS A SALES ORIENTATION, IT PUTS MOST OF ITS EFFORTS INTO CREATING STRONG SELLING
METHODS, RATHER THAN INTO PRODUCT DEVELOPMENT OR FINDING OUT ABOUT CUSTOMER NEEDS
• SOME CORPORATIONS SUCH AS AVON AND KIRBY VACUUMS, CONCENTRATED ON TRAINING SALESPEOPLE TO
ENTHUSIASTICALLY HIGHLIGHT PRODUCT FEATURES AND DEMONSTRATE PRODUCT QUALITY.

 DOOR TO DOOR DEMONSTRATIONS WERE COMMON IN THE 1950S.

 POLAND 2000 – CASE SALES ORIENTATION

INSIDE – OUT PERPECTIVE

MARKETING CONCEPT
• FROM 1960S - FOCUS ON THE CUSTOMER!
• DELIVER SATISFACTION BETTER THAN COMPETITION
• STARTING WITH MARKET RESEARCH, COMPANIES AIMED TO MATCH PRODUCTS CLOSELY WITH THE LATEST
CONSUMER TASTES.

OUTSIDE – IN PERPECTIVE

 POLAND 2019

THE SOCIAL MARKETING CONCEPT

 A COMPANY SHOULD MAKE GOOD MARKETING DECISIONS BY CONSIDERING CONSUMERS' WANTS, THE
COMPANY'S REQUIREMENTS, AND SOCIETY'S LONG-TERM INTERESTS. IT IS CLOSELY LINKED WITH THE
PRINCIPLES OF CORPORATE SOCIAL RESPONSIBILITY AND OF SUSTAINABLE DEVELOPMENT
  Marketing 1.0  Product was king
 Marketing 2.0  Consumer was
king
 MARKETING 3.0  WE OBSERVED
CONSUMERS TRANSFORMING INTO
HUMAN BEINGS WITH MINDS,
HEARTS AND SPIRITS

• THE TECHNOLOGIES WE ARE SEEING TODAY ARE NOT NEW.

• NEW TRENDS ARE EMERGING FROM : THE “SHARING” ECONOMY, THE “NOW” ECONOMY, OMNICHANNEL
INTEGRATION, CONTENT MARKETING, SOCIAL CRM, AND MANY OTHER THINGS.

WHAT IS MOST IMPORTANT IN MARKETING 4.0?

• “MARKETING 4.0 IS A MARKETING APPROACH THAT COMBINES ONLINE AND OFFLINE INTERACTION BETWEEN
COMPANIES AND CUSTOMERS. IN THE DIGITAL ECONOMY, DIGITAL INTERACTION ALONE IS NOT SUFFICIENT.
FOCUS ON EXPERIENCE.
• CONSUMERS DO NOT FOCUS ON, “WHAT DOES THE PRODUCT DO?”
• THEY FOCUS ON, “HOW DOES THE PRODUCT MAKE ME FEEL? DOES IT REPRESENT MY VALUES AND WHO I AM?”
• TO THIS END, EXPERIENCE IS HUGE. THIS IS HOW COMPANIES LIKE SEPHORA COMPETE WITH RETAIL GIANTS
LIKE AMAZON. THEY PROVIDE EXPERIENCES THAT MAKE THE BRAND MEMORABLE AND THAT THEY WANT TO
SHARE WITH OTHERS.
• MARKETING 4.0 INTERACTS WITH CONSUMERS ON AN EMOTIONAL AND EXPERIENTIAL LEVEL.

BE AUTHENTIC.
• CONSUMERS HAVE A HUNGER FOR INTIMACY.
• CUSTOMERS TREAT COMPANIES AS FRIENDS, MAKING THEM AN INTIMATE PART OF THEIR LIFESTYLES.

Lecture 3.

 The micro/market environment refers to the forces that are close to the company and affect its ability to serve
its customers. It includes the company self, its suppliers, marketing intermediaries, customer markets,
competitors, and publics.
o We can influent on them
 The macro / global environment refers to all forces that are part of the larger society and affect the
microenvironment. It includes concepts such as demography, economy, natural forces, technology, politics, and
culture.
o We have to agreed to them
Definition of Marketing Strategy

SWOT Analysis
 Tool
 Common Mistakes
 S or W / O or T how to asses

 SWOT matrix + FINDINGS FOR SWOT (what have we thought about those weakness)
 Strenght and Weakness comes for the company
 Opportunities and Treats como from the environment

Benchmarking
 What is it?
Benchmarking – The process of measuring products, services, and processes against those of organizations
known to be leaders in one or more aspects of their operations. Benchmarking provides necessary insights to
help you understand how your organization compares with similar organizations, even if they are in a different
business or have a different group of customers.
 How to use?
How Benchmarking works:
1. Select a product, service or process to benchmark
2. Identify the key performance metrics
3. Choose companies or internal areas to benchmark
4. Collect data on performance and practices
5. Analyze the data and identify opportunities for improvement
6. Adapt and implement the best practices, setting reasonable goals and ensuring companywide acceptance
 Why to use?
Businesses can use benchmarking in their operations to measure themselves against internal or external
standards. Benchmarking can be used to measure internal progress, performance against competitors and how
your processes rank against world-class organizations.

 Observe competitors
The Five Forces Model

Size of the market = Number of Companies x EXP

PEST
 Political factors
 Economic factors
 Social factors
 Technological factors

Building Marketing Strategy

Lecture 4. Market research. Why you need it?
Market Researcher

Why do you need it?

 For growth

How could you grow?

 Data has a better idea

 Feel nothing, do nothing
 We help clients to make data driven decision
Different dimension of market research studies
By topic

By technique

By place

By goal

By method
 It was Old School

By area of expertise

Brand strategy business questions

Brand guidance business questions

Tracking example

Lecture 5. Segmentation
The STP Model

Segmentation

Key questions
 What we want to divide?
 How we want to divide?
Types of segmentation
 People
 Occasions
Consumer segmentation

Demographics
Lifestyle

Needs
Behavior
 Big Data

U&A = Usage & Attitudes

Types of segmentation
 Occasions
 Antek has different needs in his mind

 Consumption behavior can be explained best by looking at the needs in the moment of consumption
 The same consumer reaches for varied products that satisfy his needs in the moment of consumption

~
 What do we do?

NeedStates origins
The term “needstate” was first used by the Mars marketing team to describe how brands can be developed so that
they dominate a context in which a brand is often selected. The result of this model of thinking can been seen today
– certain chocolate brands have come to dominate a needstate thus creating a brand heuristic.

 “becoming a “needstate” analyst is probably time well spent…”

What are the NeedStates for

1. Managing your Portfolio
o Defend the position you are already strong in, start to own it
o Leverage your position by expanding to neighbour areas, especially if you can find a common platform
o Maximize the reach with your portfolio - with 2 brands target 2 different Needstates

2. Finding a (Umbrella) Brand Positioning

o Be single-minded! Find one platform/ Needstate: one single area to anchor the brand in a credible way!
o Look for emotional & functional drivers to create a unique experience with your brand
3. Detecting White Spaces (for Innovations)
o Try to find white spaces by analysing the volume poo
o Best space we look for; robust volume, weak competition
o How to conquer in the best way? By new brands, new flavours, new channels, etc.?
4. Finding Differentiation
 Find within the same Needstates the story behind single needs to better differentiate vs. competition
5. Building Mix Optimization
 All about the execution to follow the positioning - tonality & visuals, pack format, flavour/additives, line
extensions, distribution channel, promotions, online content/ engagement ideas, etc.

Demand moments

Good segmentation by Kotler

Main rules to create good precise segmentation

VISUALIZE PEOPLE, NOT PRODUCTS
 Does the statement make you think of products or people?
o X Green products are better for our planet
o V I take steps every day to be green
o X High fat products are bad for my heart
o V I regularly avoid fat in my diet
FEW RATHER THAN MANY (MINIMIZE CORE BELIEFS)
 Does the statement lead you to visualize most of the people you know or some of the people you know?
o X A clean house makes me feel good
o V I clean every day to ensure my home makes me proud
o X Family is important to me
o V Almost all of my free time is spent with my family
"I DO” RATHER THAN "I FEEL" OR "I BELIEVE
 Does the statement help predict behaviour?
 o X I believe happiness is more important than success
o V The decisions I have made in my life almost always favour happiness over success
o X I am a religious or spiritual person
o V My religion/spirituality strongly influences the choices I make
BE STRONG
 Does the statement let the 5-point scale do its job?
o X I tend to eat right
o V I almost always eat right.
o X I try to use environmentally safe products
o V I almost always choose the more environmentally safe product option
Lecture 6. Marketing Strategy – Promotion
The 7 P´s Marketing Mix
 Product
 Promotion
 Price
 Place
 People
 Process
 Physical evidence

Promotion
Objetives of PROMOTION
 Every strategy has its objectives

The AIDA model

Forms of PROMOTION
 ATL above the line  BTL below the line
o The media: o POS (point of sales), e.g.:
 TV  Leaflets
 Radio  Posters
 Outdoor (OOH) o Personal selling
 Press o Events / product sampling
 PR
 Digital / social

The media
 PAID – any media the brand pays for, e.g. TV, radio, press, OOH, digital, paid social
 OWNED – brand’s resources, e.g. its website, social channels, the product
 EARNED – consumer resources, e.g. the publicity the brand earns, consumer generated content

PROMOTION MIX
PROMOTION MIX – Combination of promotion tools used to reach the target market and fulfil the organization’s
overall goals
But how to choose it?
#1 Look at your GOALS
 Awareness → consider a TV campaign
 Consideration → help with the digital
 Purchase → direct radio campaigns may
work really well
 Preference → the store service is a value,
social media as source of recommendation
 Loyalty → continuous brand experience
 Image (e.g. differentiation) → TV is best to
communicate the change, but RTBs (real
time bidding) needed in other media
 Education → content & infotainment

#2 Look at your BRAND / PRODUCT

#3 Look at your COMPETITION / MARKET
 Brand positioning & target groups → similarities & differences
 Communication → what & how the benefits are communicated
 Media → what they do & does it work

#4 Look at your TARGET GROUP

 Demographics:
o Gender & age
o Family & job status
o Place of living
o Education & income
 Behaviour and attitudes:
o Values
o Interests
o Needs to cover
 Media consumption:
o What
o When
o Why
#5 Look at the TIMINGS / SEASONALITY

#6 Look at the TRENDS

 Consumer & lifestyle
 Media
 Technological
 Category
And remember about the budget (cost effectiveness) & law
Lecture 7. Building marketing strategy – PRICE
 On the market you will always find companies with cheaper product!!! Try to avoid price war …
 But the price is the most critical variable for client …

 Do not concentrate initially on the price in other not to compromise the quality of the product

Price
How we calculate the price:
 Cost  Cost to produce the product, needs to cover the production
 Competitors
 Demand

Pricing strategies
 Cost-based – the cost of producing the product + percentage (profit) = SP
 Competition-based - setting the price based upon prices of the similar
competitor products
 Creaming – selling a product at a high price, sacrificing high sales to gain a
high profit
 Price discrimination – Setting a different price for the same product in different segments to the market
 Premium pricing - keeping the price artificially high in order to encourage favourable perceptions among buyers,
based solely on the price
 Other?

Discount
Discount – Reward for customers to behave in a way we are expecting
 Discount as a tool for training our customers?

Discount strategies
 To buy in bulk
 To buy earlier
 To buy at last time
 To encourage building relations
 To encourage promotion of our company / products
 Other?

Financing
Financing – The process of providing funds for business activities, making purchases, or investing

Methods of payment:
 Oppen Account
 Letter of credit
 Bank collection
 Advance payment

Payment terms:
 Advanced payment terms
 Delayed payment terms
Pricing
 List price
 Discounts
 Payment terms