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Marketing (Marketing is the activity, set of institutions, information they have, the cognitive limitations of their

and processes for creating, communicating, delivering, minds, and the finite amount of time they have to make
and exchanging offerings that have value for a decision.
customers, clients, partners, and society at large) Anchoring and adjustment is a psychological
Production Concept (1890s-1920s): consumers will heuristic that influences the way people intuitively
prefer products that are widely available and assess probabilities.
inexpensive. Selling Concept (1920s-1950s): L6 Same information but different presentation affect
Demand gone down hence selling concept flourished. market. For low priced purchases brand recall is
Sell what ever factory is producing (SELL Concept important. Brand building by Taj after 26/11 is classic
PUSH Oriented). Marketing Concept (1950s-Till example. Segmentation is Dividing the market into
date): Bring customer satisfaction. (Marketing Concept groups of (actual and/or potential) customers so that
PULL Oriented). Societal Marketing (1980s – Now): each group is relatively homogenous with respect to its
Keep society in mind when developing business characteristics, needs, evaluations or behaviors. The
otherwise it is new marketing myopia. groups are called market segments. It helps in
Value from Firm’s perspective i.e. Net Present Value is Optimizing effectiveness (by More targeted
CLV (Value obtained from customer over life time marketing mix, Increased customer satisfaction, and
Higher CLV) and Optimizing cost-efficiency (by
Doing away with irrelevant differences to create single
offering for customers within each segment).
Characteristics of Good Segmentation is mutually
exclusive (ME) and collectively exhaustive (CE),
Homogenous within, Heterogenous across. Profile-
association). Application of CLV: helps in taking based segmentation: 1. Demographic (Social)
decision whether to spend on advetisement for one age(horlicks), income(automobile industry),
customer or not. Upselling: convincing to buy higher gender(fairness cremes). 2. Psychographical-- Life
valued product. CrossSelling: Selling complementry style, health, risk taker. 3. Behavioral – use, buying
product (Laptop with mouse). pattern, freq. Purchases. 4. Geographical – Region,
Value from Customer’s Perspective is Customer country(Food & aparel). Approaches to Segmentation
Perceived Value (CPV). These Values are Economic --- Qualitative (judgement based) and Quantitative
(Benefits, cost), Psychological(satisfaction, feel good (Cluster based). Features to look for when segmenting
factor), Functional (durability, ease of use, features). a new product: {price, variety, service, ambience,
Economic value to customer (EVC) = Total cost of layout, new products, quality} --> do statistical survey
owning competitng product – Total cost of my product. and clustering to identify segments(ideal Size <6). -->
L5. Pioneer of customer & market research: P&G. profile the segment (what potential cutomer want, who
Needs are of two types: Utalitarian: Used for personal are these customer, how to reach out to them). --> Now
purpose eg. Deodrant. Hedonic: Used for fun, understand their age, demo, pshyco, gender, age etc.
pleasure and more specific needs eg. Casual t-shirts. --> pick an appropriate channel to reach out and
Observational Research pioneer P&G. 40 Variants of communicate.
tide developed based on relentless observational L7 Targeting is Selecting one or more markets to
research by P&G across markets. Focus Group: 8-10 enter. Criteria of Targeting: Segment attractiveness
people gather, one is moderator and they discuss and (Segment’s ability to deliver value to the company and
lot of insights are gathered. Ethnographic Study: its collaborators, how valued is segment) Segment
Spend time with community to understand actual needs compatibility (Company’s ability to create superior
of customer and their problems faced. (Used by Gillete value relative to the competition, can you add value to
Guard). segment). Tageting approach based on segmenting:
Failure of New Coke: (even after thorogh market Mass marketing (Tata Salt, dettol), One to One (BMW,
research they failed, pepsi made them do this blind Subway, credited to dell for this marketing technique,
test). Best Remedy: consideration of effects of social Panasonic POS). Segment-based marketing (Multiple
influence should become standard part of new product segments or single segment concentration), Niche
dev process (NPD). Focus group is an important marketing: one or a few usually small segments.
qualitative technique that can reveal social interaction Samsung sells a number of smartphones targeted at
effects. different segments, whereas Apple has focused on the
Chotukool Sucess: Ethonographic research was premium segment of the market with its iPhone.
done. high-end insulation, low cost, battery operated.
Collaboration with post office for grass root reach and Prepared on 07/07/19 for MM (RM) QUIZ 1 by vk.
reduction in distribution cost.
Tropicana Failure: they lost sight of experience their
customers have in supermarket.More focused on
reinvograting the pracking. This shows the Importance
of observation research.
Decoy (Popcorn) Effect: is the phenomenon whereby
consumers will tend to have a specific change in
preference between two options when also presented
with a third option that is asymmetrically dominated.
Bounded rationality is the idea that in decision-
making, rationality of individuals is limited by the