Post Graduate Program in Management

by upGrad and IMT Ghaziabad

 Workshop Agenda

Today’s Agenda
1. Overview of STP and 4Ps
2. An introduction to case-based learning
3. Overview of the IKEA India case
4. Small group breakout sessions
5. Concluding analysis
 Marketing Frameworks

Why Use Frameworks?

● Marketing isn’t rocket science - it’s mostly common sense
● However, effective marketing requires research, analysis, and planning
● Great marketers are both analytical and creative
● But even they use frameworks because there are so many moving parts
● Frameworks help provide focus - the backbone to your marketing strategy
● The STP and 4Ps frameworks are 2 commonly used frameworks
● But there are several others:
https://www.academia.edu/5256943/Top_12_marketing_models_of_all
 STP Framework Overview

Segmentation
Demographic – You segment consumers by personal characteristics such as age, gender,
marital status, ethnicity, education, occupation, etc.
Geographic – By country, region, city, county, etc.
Psychographic – Their personality, values, lifestyle, attitudes, interests, and opinions.
Among the strongest sources that form these factors are families, region, schooling, and
society.
Behavioral – How they use the products? When will they use the products? What benefits
are people looking for from these products?
 STP Framework - Targeting

Niche marketing
High

Personalization

Mass marketing
Low
Low Reach High
Mass marketing
Personalization
- Cost per engagement is lower but
conversion rate also lower - Higher cost per engagement but
- Use for building brand awareness or higher conversion
selling low-priced products - Use for higher margin/higher
- Speak to common needs priced products/services
- Speak to individual needs
 STP Framework - Positioning

Positioning
● What attributes are most important for your targeted segments?
● How is your product positioned (or perceived) in relation to other products available
in the market?
● What is your unique selling proposition or competitive differentiation?
Functional Positioning: refers to solving a problem or providing a benefit to customers.
Symbolic Positioning: refers to enhancing the self-image, ego, or belongingness needs of your
customers.
Experiential Positioning: refers to focusing on those elements of your product or brand that
connect emotionally with your customers.
 4Ps Framework Overview

Product Price
● Attributes - how is it differentiated? ● Needs to be low enough that your target segment
● Functions - what customer needs does it can afford it
● Needs to be high enough to cover costs and
solve?
produce margin
● Needs to be competitive
● Can it be recurring?
 4Ps Framework Overview

Place Promotion
● Sell product via own stores - brick and mortar ● Which channels to find/engage potential
or online? customers?
● Direct-to-consumer or use resellers? ● Which offer the best reach at lowest cost
● Consider franchise model or JVs? per interaction?
● Which allow for better
engagement/personalization?
 Case-based Learning

How It Helps
With case-based teaching, students develop skills in analytical thinking and reflective
judgment by reading and discussing complex, real-life scenarios.
● Employs active learning, involves self-discovery
● Builds the capacity for critical thinking
● Application of learning to real world situations
● An opportunity to exchange ideas and opinions
● Promotes more effective contextual learning and long-term retention
 IKEA case

IKEA Overview

● Founded by Ingvar Kamprad in 1943

● Privately owned - still operated by Kamprad’s family
● 433 stores in 52 countries (as of June 2019)
● Sales of $44.6 billion in 2018
● Marketing done in country - not globally
● 75% of products consistent across all countries - 25% customized for country tastes
(e.g. types of wood, colours, unique products)
 IKEA case

What makes IKEA unique?

● Design
● Packaging
● DIY assembly
● Stylish at low cost
● Convenience
● Eco-conscious
● Swedish
IKEA Brand Value
 IKEA Emerging Markets

Emerging Market Strategy

● Maintain same low-cost, accessible brand appeal?
○ Can they afford to do so?
○ Competitive landscape
○ Product costs, shipping costs, etc.

● Or change positioning?
○ Leverage global brand to command higher price point
○ Change segment strategy?

● Regulatory considerations
 Emerging Market Positioning

FAMILY

United States

AFFORDABLE PREMIUM

SPORTS

Market conditions (namely, high tariffs) meant a change in positioning was

necessary in order to enter the market.
 Poll Questions

Technical Requirements
Attendees using the desktop application or the Zoom mobile app will be able to participate in
polling, but those using a web browser (such as Chrome or Firefox) are unable to view or
participate in polls.
 Poll Question 1

Segmentation/Targeting
You are in charge of developing a marketing strategy for
IKEA’s IDÅSEN product line. Which of the following
segments is your #1 target?
1. Students
2. Young single professionals
3. Middle income families
4. High income single professionals
5. Startups
6. Small-to-medium sized businesses
7. Large enterprises
 Question 1 Summary

Segmentation
1. Demographic - young, single/married, young family, small residence
2. Geographic - urban, suburban
3. Psychographic - style conscious, eco conscious, budget conscious
4. Behavioural - new apartment/home, recently married, new office for business
What needs is your product meeting? What benefits is it providing?

Targeting
Segment attractiveness - size, growth, ease of engagement
What is your unique selling proposition (USP) for each segment?
 Poll Question 2 - Perceptual Maps

HIGH QUALITY
1 2

LOW PRICE HIGH PRICE

4
3
LOW QUALITY

Your have been hired by IKEA to provide advice on brand positioning in India. You provide
them with a perceptual map. Where would you place IKEA?
 Poll Question 2 - Perceptual Maps

Part 1
You have been hired by IKEA to provide advice on brand positioning in India. You provide
them with a perceptual map. Where would you place IKEA as it is perceived in India
today?
1. Low Price, High Quality
2. High Price, High Quality
3. Low Price, Low Quality
4. High Price, Low Quality
 Poll Question 3 - Perceptual Maps

Part 2
Where would you recommend IKEA position their brand for the Indian market in the
future?

1. Low Price, High Quality

2. High Price, High Quality
3. Low Price, Low Quality
4. High Price, Low Quality

Should IKEA modify their global brand positioning for the Indian market? If so, how?
 Polling Question 4 - 4Ps

4Ps - Product
Target Segment: Young, urban professionals
You are responsible for developing a marketing campaign for IKEA in India. Which of the
following product attributes would you consider the most important for your marketing
campaign?
1. Stylish
2. Affordable
3. Eco-friendly
4. Western/European
5. Functional
6. Innovative
7. Well built - good quality
8. Locally produced
 Polling Question 5

4Ps - Promotion
Target Segment: Young, urban families
Through which marketing channels are you most likely to engage with your target
customer segment?
1. Social media marketing
2. Paid search marketing
3. Magazine advertising
4. Television advertising
5. Outbound sales/call center
 Limitations of the 4P Framework

Limitations
4Ps framework was developed before we had access to massive amounts of customer data.

● Designed for physical products

● Limited application for services
● Works best for B2C, not as good for B2B
● Not an agile marketing solution

In today’s agile and digital world, you want to focus on market and customer needs first
then develop products to meet those needs.