Professional Documents
Culture Documents
Theory
Objectives
To understand the importance of product decisions in the overall business strategy Strategies at every stage of PLC Do Indian Products have a longer growth phase
Product
An ordinary cracker vs Standard McDonalds Mini-meals - Combination of benefits graphics, logo and the overall packaging well marketed
Convenience products
relatively inexpensive, purchased regularly and repeatedly, impulse purchase, minimum shopping effort Distribution is key No effort from retailers for substitution Heavily advertised Staples, impulse and emergency Milk, match-box,petrol, M-Seal
Shopping products
Products are compared, additional information is sought, merchandise studied, reassurance sought on quality, style, or value Buyers see a benefit of shopping High involvement buying behaviour
Homogenous evaluation only on price
Basmati, underwear, washing machines, crackers
Speciality products
Product quality extremely important Customers know what they want and what they are getting into Select brand in advance and are not looking for alternatives High brand insistence Exclusive distribution Advertising to build brand values, its uniqueness and the value attached Stereo, Piano, cars
Unsought products
Customers dont want are are not aware
New unsought goods
Need reach and awareness measures Amul Kool, Railway internet bookings
Regularly unsought
Personal selling is key Insurance, encyclopedias Blood donation Funerals/Gravestones
Business/Industrial products
Derived demand Price inelastic Tax treatment is key
Goods vs Services
Goods Durable or non-durable Services intangible Goods-services is a continuum automobiles
Good Good/Service Service
Product
A bundle of benefits(customers buy satisfaction, not parts) Has many aspects tangibility, consumer driven and benefit designed.Hence, we need to look at Total Product the broad spectrum of tangible and intangible benefits that a buyer might gain after purchase 1/4 Drill bit, LIC, Apna Bazaar Hood ornaments in automobiles sculptures of women, animals or air-planes now obsolete, dead and ugly dumped for a smoother look
Core Product
Colour
Brand name Packsging Customer Complaint Management Customer Educaon & Training
Future Product
Theodoore Levitt
Core Product
Mileage
Colour
CRM
Future Product
Theodoore Levitt
Product concept
The end result of the marketing strategists selection and blending of the products multilevel dimensions into a basic idea emphasizing a particular set of consumer benefits It is the essence or the core idea for positioning It is the reason for buying
Rasna
Product strategy
Convenient, economical refreshing concentrates which are easy to use by housewives into a soft, ready to serve drink
Product concept
Healthy alternative to carbonated drinks
Product Mix
Product Lines
Different products that are relatively close to each others, satisfy a particular class of needs, or are used together, or are bought by a set of customer groups or are distributed through the same channels
Product Items
One particular version of a good or a service
Variants
Product Line
ITC
Tobacco Products- Wills, Bristol, India Kings, Clasic Hotels - Welcomgroup Consumer Products Sunfeast, Sundrop Exports Agro-products Apparels - WLS Sub-optimal product mix indicators: Excess capacity High proportion of profit from small percentage of products Insufficient use of sales staff Steadily declining sales/profits
Tommy Hilfiger
ARVIND Murjani Brands Pvt Ltd (AMB), a joint venture between Murjani Group and Lalbhai Group has entered into a licensing agreement for marketing and distribution of Tommy Hilfiger mens' sportswear, mens' jeanswear and juniors' jeanswear collections in freestanding speciality stores apparel in India in spring 2004
Product abandonment
Excessive management time, low demand, uneconomical, low contribution, outdated North Star, FUS, Avis, Action, Killer, UFO Bajaj Legend, Cielo
Product Modification
Changing tastes Tangible/intangible Reformulation, redesigning, changing unit sizes, adding or removing features Numero Uno, Levis Dangerously Low, Old look, Wild leg flares and boot cuts
Tools
BCG GE PLC PIMS
Burger King
CUSTOMER PROMISE BURGER KING is flame broiled burgers, fries and soft drinks at a good value served quickly and consistently by friendly people in clean surroundings.
SBU has 3 characteristics - it is a separately planned business unit - own set of competitors - it has a manager responsible for strategic planning and profit performance
Stars
Question marks
5
Cash cows
?? ?
2
Dogs
1 8
6
10x 4x 2x 1.5x 1x
7
Relative Market Share
.5x .4x .3x .2x .1x
Strategies
Build Question Marks Hold Stars and Strong cash cows Harvest Weak cash cows, dogs and question marks reduce costs(R&D, new staff/replacement staff, advertising) faster than drop in Sales Divest Sell or liquidate the business dogs and question marks-drags
Strategy Formulation
Firms that do not produce clear strategies do not perform well.
MARKET PENETRATION
PRODUCT DEVELOPMENT
Strategies
Market Penetration - the firm seeks to achieve growth with existing products in their current market segments, aiming to increase its market share. Market Development - the firm seeks growth by targeting existing products to new geographical markets or segments. Product Development - the firms develops new products targeted to its existing market segments. Diversification - the firm grows by diversifying into new businesses by developing new products for new markets
Profit
Intro
Growth
Maturity Time
Decline
Maturity
Decline
Marketing Marketing Objective Objective Competition Competition Product Product Promotion Promotion Distribution Distribution
Maintain Loyalty Maintain Loyalty Many Many Full line Full line Reminder Reminder Many Outlets Many Outlets
Harvest Harvest Reduced Reduced Best sellers Best sellers Minimal Minimal Few Outlets Few Outlets
Time Laggards: Laggards: Innovators: Innovators: Traditional, fear Traditional, fear Venturesome, Early majority: Venturesome, Early majority: of debt, of debt, higher educated, Deliberate, many higher educated, Deliberate, many neighbors and neighbors and use multiple informal social use multiple informal social friends friends information contacts information contacts Early adopters: are information are information sources Early adopters: sources Respectable, sources Respectable, sources Late majority: Late majority: Leaders in Leaders in Skeptical, below Skeptical, below social setting, social setting, average social average social slightly slightly status status above average above average
Branding
By Prof. Mangesh Borse
Christian Mikunda
Brand
Haywards, Miller Lite, Kingfisher, Fosters Ancient rulers did it to identify the culprit if anything went wrong Forced to identify their brands with their names, the manufacturers started taking greater pride in the products and made them better than others
Brand
Products + a bundle of emotions
Brand
Branding serves both the sellers and the buyers A brand is a name, term, symbol, sign, design or unifying combinations of these A brand name is the verbal part of the brand Brand mark is a unique symbol A distinctive way of writing a brand name is the logo
What is a brand?
A brand is a name, term, sign, symbol or design or a combination of them, intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors
(American Management Association)
What is a Brand?
Claim of distinction Set of core values Communicates what business is about Sets a company apart
Brand Marks
Windows
Brand Identity
Name House Colours Baseline Design Mark(logo)
Event Branding
Service branding
Rights ..
The seller has extensive rights till perpetuity (Patents and copyrights have periods)
Brand meanings
Attributes: Mercedes suggests expensive, well engineered, well built, durable, high prestige cars Benefits: Functional and Emotional benefits
Tata- reliable Kamasutra-
Brand meanings
Culture: Birla-conventional, Relianceaggression, HLL- professionalism Personality: HLL MTNL User:
Pepsi vs Coke Barista vs Udipi
Brand equity
Value:
Morepen Laboratories the brand name 'Burnol' from Reckitt Piramal Ltd for 8.6 cr Crocin was taken over by SKB from Duphar for 75 cr The real value of the brand
My acid test . . . Is whether a housewife, intending to buy Heinz tomato ketchup in a store, finding it to be out of stock, will walk out of the store to buy it elsewhere Tony OReilly, CEO Heinz
Brand Equity
The value of the brand Burnol, Crocin, Clearasil, Hamam, Thums Up equities A strong brand is an asset
Strong entry barrier Represents the high proportion of customers who love the brand Competition needs huge spends to create another onemedia, distribution, sales force, advertising
Packaging
Designing and producing the container for a product Labels
Salience Imagery Stand out in clutter Mnemonic Legally correct
Brand Exercise
McDonalds Pepsi Mahindra American Express
Problem
Any barrier or situation that makes it difficult to achieve an objective
Opportunity
Situation or circumstance that can potentially give the company a marketing advantage
Problems
Related to sales or market share Not easy to change
Product line, price or distribution
Adjust promotion (or communication) Is it persuasive? Is the consumer aware? Are the media channels the most effective?
Opportunities
Good companies turn problems into opportunities Many things must happen to make change
Problem/Opportunity Examples
Arm & Hammer
P: Cooking use limits potential O: Developed new uses (freshens refrigerator and freezer)
Problem/Opportunity Examples
McDonalds
P: Indian snacking habits - rigid O: Developed new indianised menu
Problem/Opportunity Examples
A-1 Steak Sauce
P: Use of A-1 is sporadic (forgot to use it) O: Place the word refrigerate on the bottle
Colgate
P: Poor usage per occassion O: increase nozzle
Problem/Opportunity Examples
Must anticipate response of competition Hunts ketchup
P: Pours slowly O: Made a bottle with a bigger opening
Heinz ketchup
P: Pours slowly O: Associate slow pouring with richness
Opportunities
Good companies turn problems into opportunities Many things must happen to make change
External Factors: Political, legal, cultural, social
Indian cricket team back in Pakistan
Financial Resources
Must have sufficient capital to
Initiate action and sustain activity
Pizza Example
Low overhead with dine-in only Expand overhead if include home delivery Home delivery needs speed To speed up baking need Rs 25L conveyor oven To get decent return must draw more business
Production Resources
Thinking up new product concept or service is easy Producing it is more difficult
Saffire zi
Marketing Resources
Must have marketing-savvy people in decision making positions Tata Indicom
Good production resources to make cellphones, but Tatas could not drive demand
Marketing Resources
Ford Motor Co.
Good production resources to sell cars, but Henry Ford only sold black automobiles
General Motors
Focused on marketing
IMC
Introduction to IMC how it differs from previous marketing communications practice benefits and barriers implications for agencies and clients of using IMC
IMC
The process of integrating all elements of the marketing communications mix across all customer contact points to achieve greater brand coherence. Elements of marketing communications mix include: advertising packaging sales promotions sponsorship PR product placement direct marketing
Why do IMC?
To increase communications effectiveness and consistency to promote synergy. But no common consensus on what IMC
Benefits of IMC
Promotes customer focus leads to a recognition of all audiences means clear objectives are set encourages consideration of full range of media vehicles and use of communication methods
Barriers to IMC
Reluctance of industry to change messy organisational structure budgeting remuneration for agencies internal and external factors
Example of IMC
how advertising featuring a simple idea was extended to all media uses advertising objectives, target market research, and evaluation to present a convincing argument for the power of IMC
ICICI launch
TVC Print Mailers Youth magazines Crossings Internet Outdoor
Campaign performance
Established ICICI Prudential as a reliable brand Initial trials were very good But the IMC worked Today, ICICI Prudential is the leading Private Insurance provider
ADVERTISING
Advertising
Paid form of non-personal persuasive communication with set objectives Different for PR, CRM, Sales Promotions
Advertising Process
Marketing Strategy Advertising Strategy Objective setting Budgeting Message Strategy Media Strategy Strategy Implementation Assessing Advertising Effects
Differentiated market
Divided market into sections (primary, secondary and tertiary) Identify target audience and refer to target groups or Call everything the target market audience ITC Bristol, Wills, Classic, India Kings
TYPES OF ADVERTISING
Institutional Advertising Promotes an organization and its image & reputation Product Advertising Promotes specific products Business to Business Advertising Target is other businesses
ADVERTISING AGENCIES
Much of the Work Is Done by Few Super-Agencies, e.g. WPP JWT, ONM, MINDSHARE, BATES, EQUUS INTERPUBLIC LOWE, ENTERPRISE NEXUS, INITIATIVE MEDIA, QUADRANT MUDRA Full-Service Vs. Specialized: MINDSHARE, DIREM, RURAL RELATIONS, SAMPARK, OGILVY LANDSCAPES, ANUGRAH Often Work on Commission - (% of media time) Fees, Contracts
Process of advertising
Brief Strategy/Insights Creative
Research
Media
Monitor
Collection
Financials
Advertising
Media
Client Service
Why psychology
The real reasons for brand buying are never rational As more and more products become metoo, USPs are replaced by ESPs
Motivators
Health Security Prosperity Approval Attraction Comfort Sensuous Pleasure Egotism Curiosity Family bonding IQ stimulation/growth Fear Hero worship
I N P U T S
Black Box
O U T P U T S
Behaviour
THE APPEAL
Hard Sell (Product Centered) USP - Unique Selling Proposition One clear reason why the product is better.
Benefit
ABenefit is an attribute of the Product (or Service) which implies or explains how a Customers NEED will be fulfilled! (i.e. how the Product will be of benefit)
Benefit Barrier
ABenefit barrier is an psychological belief that acts as a deterrent to the consumer from believing in the benefit
Benefit Barrier
Cadburys Diary Milk
Consumer Insight:
An insight is
A deeply felt human truth that links our lives to our brand
True and new Instant attention Touched a nerve Hit a hot-button Struck a chord
Consumer Insight:
An insight is
+ I am a mediocre investor
Insights
Everyone feels he/she is the best thing that has happened to the world Women spare a last look in the mirror Car drivers look down upon three-wheelers, three wheelers look down upon 2 wheelers, and so on When it comes to a dish, we always check others before touching yours People communicate strangely in different situations train, bus, lift, road
Current Do
Proposition
Desired Belief
Support
Desired Do
ADVERTISING STRATEGY
Mothers
Kids
Icecreams/chocolates mess up the teeth Brushing is the only dental hygiene habit
AVOID
Shift!
Brief
Understand the product Manage the information Learnings from research Select the key benefit Excite the creative team
Actal
Anti-flatulant Antacid No wind
Kaminomoto
Hair vitaliser Local laws did not permit following for this category
Logo Brand promise Pack shot
Kaminomoto
tera chehra.exe
Advertising Budget
Stage in the PLC Market share and consumer base Competition and clutter Advertising frequency Product substitutability
Creative Strategy
Message Generation Message Evaluation and selection Execution Review
Message Execution
USP vs. ESP Critical for mass brands Style: Slice of life, Lifestyle, fantasy, mood or image, musical, personality symbol, technical expertise, scientific evidence or testimonials
ADVERTISING EFFECTIVENESS
Pre-testing Concept testing Copy testing Post-testing Unaided recall Aided recall Attitude measures
Media steps
Decide on reach, frequency, impact Choosing among media options Selecting the media vehicle Scheduling Deciding on geographical media allocation
TYPES OF MEDIA
Broadcast Television, Radio Print Magazines, Newspapers, Directories Direct and Interactive Direct Mail, Web, E-mail Specialty Advertising Outdoor/Out-of Home
Media Choices
Medium Advantages Limitations
short life, small passalong audience immobile, expensive, high clutter, less selectivity less attention, fleeting
Newspapers Flexibility, topical, localised, credible Television Audio + video, captive high reach Radio Mass use, economical
Hamara Bajaj
Case study
Hamara Bajaj
Fear of Honda Kinetic popularity Strengths from indianness Countrywide appeal
IMC
Print Newspapers Posters Internet Banners Ringtones(?)
Mard Mahindra
Global Leadership Multiple Products Quality Rugged Value - Economy
ADVERTISING OBJECTIVES
Introduce New Products Inform and Persuade Build and Reinforce Brand Image Get Immediate Action! Provide Ongoing Contact Help Confirm Decision Help Obtain Distribution Prepare for Personal Selling
Headline: Ju deo woh liyo! Subhead: Over the table Bodycopy: Baseline: The Taste of India AGENCY: daCunha
Subhead: Looking at me? Bodycopy: Noticed a VIP lately? You'll find the Elanza in Ravishing Red, Electric Green, Smart Blue and Charcoal Grey. At VIP Lounges, VIP Worlds and leading VIP outlets. Baseline: AGENCY: HTA
Headline: New York Life Subhead: India. We are here. For life. Bodycopy: Imagine a multi-business corporate, driven by the spirit of enterprise, focused on the knowledge, people, and service-oriented businesses of healthcare, life insurance and information technology. Then, for a moment, imagine one of the world's experts in life insurance. A Fortune 100 company with 156 years of experience in the business and over US $ 138 billion in assets under management. That's MAX NEW YORK LIFE. Together, we wish to provide you with focused, flexible and value-driven service. Why would you do business with us? For one, we are specialists. Life insurance is all we do. We are flexible and professional when it comes to doing business. Above all, we are transparent and financially responsible. At the heart of our service lie professionally-trained agents with integrity. Call us and experience the difference. We are also a reflection of your real needs. We have a whole host of convenient features such as the free look option and Personal Insurance Plan. Additionally, we are available 24 hours a day on our Helpline. All of this, we believe will help us build a great partnership with life in India and indeed the lives of Indians. So, if you wish to experience a whole new way of looking at life insurance, look at us. MAX NEW YORK LIFE. Insurance now gets a fresh new life. Baseline: Your partner for life AGENCY: Equus
EXECUTION FORMATS
Lecture
Demonstrations- ads\Parker pen Collage.mpeg Problem Solving- ads\VIM BAR Halwai.mpeg Testimonials- ads\Balbir Pasha BAR.mpeg
Drama
Slice of Life ads\Fair & Lovely Cricket 60 Sec.mpeg Storyline ads\Bajaj Caliber 115 Picnic 60 Sec.mpeg Lifestyle-ads\VIP Luggage 30 sec swing.mpeg Humour- ads\St. Gobin Cafe.mpeg
Execution- Radio
Humor Functionality Relevance Social Awareness Proposition
Future shock
Specialisation will be the order of the day In medium to long term, successful personnel will shift to consultancy, BPOs, internet start-ups, or specialised media like DM, Event Management, Rural marketing, TV or Radio
Future shock
They will have an Advertising co-ordinator Large agencies will try to specialise in any one of these fields Small agencies will be advertising even smaller brands
Future shock
Businesses will be more vulnerable and will work towards reducing risks Research will only continue to grow, with the virgin territory of the internet
Art of survival
Resolve Discipline Know more Adapt Pass the baton with a smile
OGILVY ON ADVERTISING
If each of us hires people who are smaller than we are then we will become a company of dwarfs. But if each of us hires people who are bigger than we are, we shall become a company of giants.
Thank You
Prof. Mangesh Borse
mangesh.borse@welingkar.org