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Marketing - Appunti di lezioni/libro e domande di 3 diversi
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Marketing (Università Ca' Foscari Venezia)
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1 CREATING VALUE
Marketing is the activity for creating, communicating, delivering, and exchanging offerings (value for the customer
B2B, B2C) that benefit its customers, the organization, its stakeholders, and society at large, making profit. It seeks to
discover the needs of prospective customers and to satisfy them. Customers include both the individuals buying for
themselves/households and companies buying fro their own use (manufacture)/or for resale (retailers).
Behind all of this there is the idea of exchange: trade of things of value between a buyer and a seller so that they are
both better off with the trade.
The marketing department is influenced by:
• Internal environment: managers (brand/product, marketing, sales, advertising..) CEO, departments..
• External environment: suppliers, costumers. Shareholders and competitors
• External forces (PESTEL).
POLITICAL: foreign trade policy, political stability, corruption..
ECO: growth, interest rates, inflation, unemployment,…
SOCIAL: age distribution, population, safety emphasis, health,…
TECH: level of innovation, automation,…
ENV: weather, climate,.. Nowadays the main concern is sustainability bc the customers are asking it.
LEGAL: antitrust, discrimination, employment,..
MARKETING: DISCOVERING AND SATISFYING NEEDS
For marketing to occur we need four factors:
1.
Two or more parties with unsatisfied needs
2.
A desire and ability on their part to have their needs satisfied
3.
A way for parties to communicate
4.
Something to exchange
1. The first step in marketing is to understand the costumers’ needs and wants
-Smart Glasses by Google (interesting product but not loved by the mass market, nerdy and expensive)
-Coca-Cola Stevia no sugar (they are trying to follow the new trends but consumers say that stevia has a bitter
aftertaste)
-Universal Yums subscription (snacks every month, consumers tire of new products)
Consumer needs: person feels deprived of basic necessities such as food, clothing, shelter
Consumer wants: need shaped by a person’s knowledge, culture and personality.
Marketing tries to influence our wants, effective marketing tries to create awareness of good products at fair prices
and convenient locations. Maslow’s hierarchy of needs and
solutions: customers have needs (perceived lack) and companies try
to find solutions. There is the need to fulfill each level and then pass
to the other, but scholars say that every point is important.
There are 5 different levels:
Certain needs are to be fulfilled by the individuals, others by the
companies. But how do companies know which product they have
to make? The need becomes a want (desire linked with the culture,
money, time)
Segment: group of consumers acting similarly and having the same
desires
• How to discover a need? Every person has the same needs, easy.
• How to discover a want? Difficult bc connected with the culture,
experience, situation, personality..
• How meeting needs with products (goods and services)? Products should fit with the needs and wants.
Companies continue proposing products so that they can meet the costumers, the problem is that the consumers
change opinion continuously. Once I find a solution it can become old and no longer fit with the needs.
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MARKET: place in which people is exchanging values (goods, services..). The form of the value can change depending
on the form. Place in which people have both the desire and the ability (authority, time and money) to buy a specific
offering.
Since the company cannot satisfy the needs of all consumers, they decide to focus on the needs of a specific group of
potential consumers which is the target market, the company directs to them its marketing program.
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2. The company should start satisfying the needs by creating an offer, the company is creating a marketing mix:
originally, in the American theory there were the 4 Ps (product, price, place, promotion) but then we had more parts
in the offer
• PRODUCT (good, service or idea)
• PRICE (what is exchanged for the product)
• PROMOTION (means of communication between the seller and the buyer)
• PLACE (means of getting the product to the consumers)
• PERSONS (can makes us have an opinion on the brand)
• BRAND (sometimes brands<product or products>brands)
• RELATIONSHIP (with the brand, product and offer)
• MYTH (Ferrari, entire offer the company is proposing to the market)
•...
The 4 Ps are the controllable factors for the marketing department. Each company offer solutions for different
marketing mixes, maybe similar but not identical.
There are also other factors that influence the business and they are environmental forces: social, eco, technological,
competitive and regulatory.
Marketing strategy:
1. Describe the market, the people and their needs and wants
2. Positioning: position our offer differently from competitors
3. Marketing mix is built
4. Market planning: how to go the market, how many shops in which countries,..
5. Competitive behavior: is organized, how the company is behaving to attract more costumers
Who markets? Every organization and also certain individuals (politics)
What is marked? Goods (physical objects), services (intangible items) ideas (thoughts)= product that satisfy needs
and is exchanged for money or value.
Who buys? They can be ultimate consumers (people that buy for their home) or organizational buyers (organizations
and governmental agencies that buy for their own use or resale).
Who benefits? Consumers, organizations and also society. Marketing creates utility: form (production of the
product), place, time and possession (easy to purchase).
CUSTOMER RELATIONSHIP
Gaining loyal customers by providing unique value is the goal, firms create relationships with customers through
coordination of the 4 Ps.
Costumer value: combination of benefits received by targeted buyers (quality, convenience, on-time delivery, before
and after sale service)
Nowadays firms aim to build long-term relationships with customers by providing one of the three value strategies:
-BEST PRICE: competitive prices
-BEST PRODUCT: performance of products
-BEST SERVICE: experience
Relationship marketing: links the organization to its individual customers, employees, suppliers and partners.
Technology helps in creating relationships with customers.
Effective marketing relationships help discovering prospective consumers needs and convert these into marketable
products. All these ideas can be included in the marketing program: a plan that integrate the marketing mix to
provide a good, idea or service to buyers. Market segments: homogeneous groups of prospective buyers that have
common needs and will respond similarly to a marketing action.
Ex. Post-it managers tried to discover how students study and how workers work. They made researches and they
discovered the specific needs, then they created new products.
How did marketing become so important?
Marketing concept: an organization should strive to satisfy the consumers’ needs while also trying to achieve the
organization’s goals.
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Market orientation: continuously collecting information about the customers, sharing the information across
departments and using it to create value.
Customer relationship era: organizations contact consumers via apps.
Customer relationship management (CRM): process of identifying prospective buyers, understanding them and
developing favorable long-term perceptions of the organization and its offering so that buyers will choose them and
become advocates after the purchase. The foundation is customer experience: internal response of costumers to all
aspects of an organization and its offering.
Nowadays the marketing practice have shifted from the producers’ interests to the consumers’ interests. Balancing
the interests of different groups: ethics (many organizations have developed policies, guidelines to assist managers
since there are no regulations concerning some marketing issues), social responsibility (organizations are accountable
to a larger society: eco-friendly, philanthropy..), marketing concept (firms should satisfy the needs of consumers in a
way that provides for the society’s well-being.
Creating value is necessary, if you do not create value for a customer they will never buy. It’s possible to create value
through production, innovation, (administration -> efficiency VS marketing -> effectiveness)
How to create value through marketing:
Ex. The value of coffee: The price of a cup of coffee at the field is about 2 cents. The retail price of a cup (coffee
powder) is around 26 cents. Why is it 10 times the price? The beans are worked and turned into powder, distributed,
packaging… You buy a coffee in the bar and pay 1.10 $ bc they also offer the service, the biscuit, the location, music,
you are with friends etc…San Marco Square “Caffè Florian” the coffee is 15$, you buy the experience not only the
coffee
An experience should be made by entertainment, educational (story telling), aesthetic and escapist (another world).
Value drivers of Ferrari cars: status, performance (no lies otherwise you loose the customers), exclusivity, community,
experience (city factory, dealer and then you spend the day with them).
Value components (functional)
-Price
-Quantity
-Mass status
-Efficiency
-Basic performances
Value components (emotional)
-Immaterial
-Quality vs. Quantity
-Exclusivity
-Entertainment
-Symbols (emo +social)
Value components (tribal)
-Community
-Shared experience
-Linking products
-Entertainment
= Convenience
=Experience
=Relationship
Something that you have daily, something with significance, relationship created w/ the product and brand
Production
Marketing
Case history: Panettone
Loison 1938 only made sweets and the 3rd generation bought the company from the father and they started to make
panettone (traditional product with a lot of competitors such as Bauli, Motta…). There are many producers and the
main competitor is Bauli, they wanted to create something different: quality, innovation and communication. It was
a little company compared to the competitors. It started producing the product not in an industrial way. The founder
made use of real ingredients: real eggs and not powder, real butter. The founder went to Sicily to look for the canditi
and to see how they were doing the panettone, they did not introduce creams. They increase the value, innovation
of the product and innovation, “unusual panettone as an appetizer”, museum and library for important people: 35 is
the price including the experience, the performance, packaging. A Bauli panettone costs 7.
2 MARKETING STRATEGY:
An organization is a legal entity formed of people that share a mission and develop offerings (goods, services,
products). They want to create value for both the organization and the costumers.
1. BUSINESS FIRM: privately owned organization that aims to earn a profit (R-&)
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2. NONPROFIT ORGANIZATION: they do not aim to earn a profit but operational efficiency or costumer satisfaction.
Anyway, they need enough funds to survive
3. GOVERNMENT AGENCY: state unit that provides a service
Organizations with similar offerings develop an industry, so they make strategic decisions to create an advantage.
Strategy: an organization’s long- term of action designed in order to achieve its goals. It is the route to be followed by
the ship (company) helped by a map (plan) and lighthouses (goals). Goals, plans and actions.
Plan: action, time and resources included in the strategy
Ex. Competitive strategies:
-Nutella (market leader for 70 years, nut chocolate),
-Pan di Stelle (new in the market, biscuit+ chocolate),
-Nocciolata (organic product)
Their communication:
Nutella: the target are families and young people, suggests that it is a normal breakfast. Perfect idea
Pan di Stelle: functional position, they show the product and how it is made
Nocciolata: less perfection, normal boy. They present the product as sophisticated (strawberries, tails..)
Different positioning with different levels of sophisticated: bc they have different targets
-emotional
-functional
-descriptional
In a competition you have far competitors (also include Nocciolata, whole arena) and close competitors (Nutella and
Pan di Stelle). They have three different views of the market, so they create different products.
THE STRUCTURE of todays’ organizations:
1. BOARD OF DIRECTORS
2. CORPORATE LEVEL: overall strategy of the business. Chief executive officer CEO.
3. STRATEGIC BUSINESS UNIT: group of business for a set of offerings to a targeted market. Usually subsidiary, unit,
division..
4. FUNCTIONAL LEVEL: each SBUs has its own functional level. They create the value, departments (specialized
functions ex marketing, finance), cross-functional teams (people from different departments accountable for a
task)
Nowadays organizations must be forward-looking: anticipate the future and be quick in adapting. A visionary
organization has to specify
• Foundation (why it does exist):
- Core values: principles that guide the B’s conduct over time and inspire its stakeholders.
- Vision and mission: a statement of the organization’s function in society that often identifies its customers,
markets, products and technologies. The way in which the company considers the society, customers, market and
the whole reality. Each company could have a different idea of the market, the description of the market is the
decision of the company, how it sees it.. The vision of the company should be clear, concise, meaningful,
inspirational, long – term. They have also recently added a social element.
- Culture: set of norms, beliefs, ideas learned and shared among members of the org.
• Direction (what will it do): direction in terms of
- Business: broad industry of the organization’s offerings. Business model: describes the rationale of how an
organization creates, delivers, and captures value.
– Key activities
– Value proposition
– Customers addressed
– Costumers relationships
– Key partners (suppliers, distributors..)
– Key resources
At the end we have costs and revenue.
Ex. Loison Business model, three main activities:
1. Production (company selects each supplier for both quality and products)
2. Sales (private labels except in Italy, branded and co-branded: such as ice-cream with smarties) they are sold
in direct shop, retail and e-commerce. (Also Horeca (hotels, catering and restaurants) sells the products)
3. Communication: addressed to retail, the web and professionals
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Each company has a B model, if we analyze how the company works in the market, we can understand its B model.
- Goals and objectives: stating which accomplishments of tasks are to be achieved by a specific time (profit, sales,
market share, quality, customer satisfaction, employee welfare, social responsibility..)
• Strategies (how): vary based on
By level: moving down the levels, we have more detailed and specific strategies and plans.
By the offerings (products): based on the physical goods, services and or ideas. Most organizations develop a
marketing plan: road map for the marketing actions of an organization for future period.
Contents of the Biz model
Customer’s Problems
Top 3 costumers’ problems
Key Activities
Key Partners
Solutions
Top 3 features
Value Proposition
Solutions: key marketing and
operating activities
Marketing
partners
Key Resources
Idiosyncratic resources
Compelling message: Value For
the customer different, worth
buying, not easy to be copied
Cost Structure
Main specific costs (costumers acquisition, distribution cost,
people..)
Customer Relationships Customer
Segments
How to relate with the
costumers
Channels
Retail , distribution
Costumer
Target
Revenue Streams
Lifetime value
Gross margin
TRACKING PERFORMANCE:
How do organizations know if they are making progress? They use
Marketing dashboards: visual displays of the essential info related to achieving the objective, key metrics. Essential
info related to achieving the objective, imp information that we have to collect continuously from the market and for
the market decisions
Ex. Geographical area, sales,..
1.Be relevant
2.Keep it simple
3.Tie metrics to objectives
4.Recommend actions
5.Use visuals to highlight successes and problems
Marketing metric: measure of the value of marketing action. Data visualization: graphical representation of the
metrics so that they can spot deviations from plans and take corrective action.
SETTIG STRATEGIC DIRECTIONS
Where is the company now? Which are the competencies (capabilities that distinguish the B from competitors and
provide a competitive advantage) the company needs to reach the goals, the present costumers are the ones we
want in the future, the competitors..
Customers: specific range of people
Competitors:
=SWOT analysis in which we recognize the Strengths (where we are the best), Weaknesses (we need to work on),
Opportunities (in the market) and Threats (that can affect the performance of the company)
We can find a list of things that can help us to organize the analysis:
1. BRAND
5. COMMUNICATION
9. COMPETITORS
13. SALES FORCE
2. DISTRIBUTION
6. PRICE
10. CUSTOMERS
14. WEB
3. PRODUCT
7. PEOPLE
11. INTERNATIONALITY
15. PARTNERSHIPS
4. SERVICE
8. IMAGE
12. NEW MARKETS
Where does the company want to go?
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DIVERSIFICATION ANALYSIS
Ansoff matrix: he addressed markets and products, divided them into
existing and new ones.
The risk is different in every situation, new situation means more risk. We
have to trade-off risks and opportunities.
● Market Penetration: strategy to increase sales of current products to
current markets
● Market development: strategy to sell current products to new markets
● Products development: strategy of selling new products to current
markets
● Diversification: New products in new markets
The most conservative is MK penetration, the riskiest is diversification.
BUSINESS PORTFOLIO ANALYSIS:
BCG matrix: Vertical: business growth rate (annual rate of growth) and
horizontal axis market share (sales of the SBU/sales of the largest firm in the
industry). They assess each SBU as a separate investment
-diversification (new market and new product)-> we are in the question mark
position bc any innovation is a ? and we need to invest a lot of money. if the
innovation has been successful, we enter in
-the stars relative position is growing, market is growing (profit is high but we
are still investing)
-when market is stopping, we are in a cash cow position (we have a lot of profit
that we will use to invest in other SBUs)
-dog position (market is not growing), they may be generating enough cash for themselves but as soon as it is enough
we have to drop them.
The path is not cyclic, may change easily
THE STRATEGIC MARKETING PROCESS:
It is the allocation of the marketing mix resources in order to reach the target markets and achieve a competitive
advantage. It is guided by 4 principles:
– Customers are different: (so they may respond differently to the marketing mix elements)
– Customers change: as their preferences, needs and behaviors
– Competitors change and react
– Organizational resources are limited: we have to make trade-offs
The process is divided in three phases:
1. PLANNING:
a) SWOT analysis: strengths, weaknesses, opportunities and threats
b) Market-product focus: determining what products will be directed towards which customers (using a market
segmentation: aggregating prospective buyers based on their similar needs and their reaction to a marketing
action). Customer value proposition: how it will solve the customers’ need, what are the benefits and why the
customers should choose this brand; also called points of difference bc it highlight the differences with the
competitors
c) Create a marketing program: developing the program’s marketing mix and budget
2. IMPLEMENTATION: carrying out the marketing plan that emerged
a) Obtaining resources, both human and financial
b) Designing a marketing organization to implement the marketing program
c) Defining precise tasks, responsibilities and deadlines
d) Executing thee marketing program (marketing strategy: how the marketing goal has to be achieved, with target
market and marketing program) we use marketing tactics, day by day operations and decisions for each element of
the marketing mix
3. EVALUATION: comparing the results with plans in order to find deviations; plan gap: difference between the ideal
projection of the path and the actual path. Then we usually exploit positive deviations and correct negative
deviations.
3 MARKETING ENVIRONMENT
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Case history: from LPs to concerts. Technology affection given by the digitalization: from LPs (long plays, 80s) to the
CDs (it changed the tools but not the systems, there were a lot of music shops in every city), then we had iPod (new
way to listen to the music, digital music) -> birth of the pirates, no one was buying.
-> So the solutions were concerts, they sold experiences.
Is it important to have a look at the company environment? For each company you have to define the components in
the environment (in order to reduce the risks), structure, changes (risky are the ones I do not see), new trends.. How
the PEST changes are affecting the producers, distributors and the users.
Trend drivers to take into consideration:
-wellbeing (every product should address wellbeing)
-rights (gender, race,..)
-value of the offer (benefits received)
-identity (the identity I want to assume)
-experiences
-surroundings (stimulation, I want to be connected with the world)
-technology
Consumer trends 2022:
• You want everything under control as costumers and the brands are supposed to help with that bc they are
consistent so predictable
• How can the company create enjoyment in the buying process? Both on e-commerce and physically.
• Ethics: every company should give its ethic path so that the customers are pleased
• Flexible spaces: we are used to buy in different ways, so the company should adapt and be omnichannel in order to
be on every channel and reach all the costumers
• Climate complexity: consumers want sustainable brands
When you have to develop a new product or retail system or communication strategy, you have to take into
consideration all of this, the trends help to be more into the desires of the costumers. To transform trends into
marketing decisions would mean having:
-The products should be eco-friendly and customized (having diversification so that customers can choose the most
appropriate one).
-Communication should be press adv and more social advertisement (customized, click and decide to enter),
advolvement (involvement in advertising)
-Brands are symbols and they build the costumers’ identity, brands should suggest more identities (ex. Hard Rock
café: chosen for the story, music, tradition, restaurants, products,..)
-Distribution can be via e-commerce (increasingly important since Covid-19, especially in big countries where there is
a problem of distance), shopping centers (should be organized so that you can spend hour there) and mono brand
(salespeople, atmosphere, architecture)
-Price diversion: low-cost, luxury and good-enough (lately the consumer behavior is not consistent, both for rich and
poor people, buying from all the levels, special occasions ex. Franciacorta or Champagne)
In every specific industry there are marketing trends affecting:
-soft drinks (climate issue: plastic bottles are not eco-friendly, how can you solve it?)
-winter sports (how can I affect technology? Italy won the curling Olympic game and Italians are now interested in
the sports)
-bicycles (electric ones having their boom)
Checklist to understand the markets:
-Demographics: getting older or younger
-Culture: perceptions of products, markets
-Macroeconomics: diff level economic development (economic boom after Covid-19, longer await times for
production, cars sales takes even a year)
-Consumer income: are they afraid bc they are concerned about the future or they buy freely
-Technology evolution
-Competition: growing or decreasing (pandemic decreased the competition bc some companies failed and other got
strong)
-Legislation: EU financial help after the pandemic, a lot of investments and organizing production, infrastructure etc
-Pandemic
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Environmental scanning : is the process of continually acquiring information on events occurring outside the
organization, to identify and interpret potential trends. Firms can respond in various ways:
- Ignorance: no change is made bc they are ignorant of the env. Changes.
- Delay action: they see the change but have a slow response
- Retrenchment: they see sales decline, so they cut costs, but they do nothing about the declining sales.
- Gradual strategic repositioning: planned and continuous change to adapt to the changing env
- Radical strategic repositioning: radical shift, especially after a crisis
➔ Identifying and interpreting trends is essential to successful environmental scanning
➔ Changes in Social Forces can have a dramatic impact on marketing strategy
The changing attitude and roles of men and women: today there is equality in the marketplace. Several factors have
contributed:
-The influence of carrier mothers who provided a point for lifestyle choices
-Increased participations in sports
=Marketing programs are becoming more similar, gender neutral to men and women
MACROENVIRONMENT: broader forces that also shape actors in the environment.
1. POLITICAL: regulatory environment in which organizations operate. Regulation can be at the national or European
level, mainly aimed to protect interests of consumers and to ensure a fair competitive field for organizations.
2. ECONOMIC: income, expenditure and resources.
a) Economic growth and unemployment: a major marketing problem is predicting the next boom or slump that will
influence purchasing power of consumers. Expectations of the future may affect the consumer spending: during a
recession consumer tend to spend less or go for cheaper alternatives. Also the income may influence: gross
income (tot made in one year), disposable income (after paying for necessities) and discretionary income (after
paying taxes).
b) Interest rates (rate at which money is borrowed by B owners and individuals); taxation (less taxes, more money
left)
3. SOCIAL: demographic forces (rising number of over 60) and cultural forces (values, beliefs and attitudes)
4. TECHNOLOGICAL: has to be continuously monitored bc small changes can make the B obsolete real quick.
5. ECOLOGICAL: climate change, pollution, scarce resources, recycling animal testing…etc
6. LEGAL
MICROENVIRONMET: immediate environment that affect the firm’s capabilities to operate effectively in its chosen
markets. The actors are distributors, suppliers and competitors.
1. CUSTOMERS: they determine the success or failure of the B, it is important to be able to identify unserved needs
and take advantage of the opportunities that present themselves
2. DISTRIBUTORS: small business directly distribute their products, but there are a lot of others that use wholesalers
and retailers. Changes in distribution can have a significant impact ex online retailers
3. SUPPLIERS: supply chains are essential for B and they have the power to restrict supply and or force the price up.
Small changes can make a difference for Bs
4. COMPETITORS: the levels of competition vary from industry to industry
Porter’s 5 forces analysis of the microenvironment: why some industries are more attractive than others and seem
more profitable.
a. THE THREAT OF NEW ENTRANTS: new entrants can raise the level of competition and they can make the industry
less attractive. The threat of new entry depends on the barriers to entry (economies of scale, capital investment,
…)
b. THE THREAT OF SUBSTITUTES: (products that can be substituted: coffee and tea, the price oof coffee could make
the tea more attractive)
c. THE BARGAINING POWER OF SUPPLIERS: the higher the power, the higher the costs of raw materials and
components for the firm. (many buyers and few suppliers)
d. THE BARGAINING POWER OF BUYERS: (few buyers and many sellers)
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4 MARKETING ETHICS
There are ethical and unethical behaviors and also legal and illegal
behaviors. Ethics and law are not always consistent bc ethics is a social
pov, law has a legal pov (social feelings can be different).
Ex. Euthanasia dilemma
The answer to ethics-law comes from the market, the companies decide
where to stay.
There are different codes of ethics, and the company should take them all
into accounts:
-Ethics of exchange: customer safety, info, choice, listening
-Ethics of competition (ext): bribery, copy, espionage, fakes
-Ethics of organization (int): no exploitation or discrimination,
-Ethics of environment: env sustainability
From utilitarianism to more
-Profitable
-Follow the law
-Be sustainable
-Be citizen
=Corporate social
Profit resp: richness for
the company
Stakeholders resp: employers,
and citizens (polluting the
Societal resp: cause related
action related to a social
stronger), green marketing
idealism (more attracting)
responsibility:
stakeholders, future for
costumers, shareholders
area)
marketing (marketing
cause, so the brand is
Sustainable marketing: every company takes this into account. It has not an easy solution, they should be taken into
the long-term plans, sudden changes are not reliable for costumers. It can humanize the brand messages and create
another reason for customers to choose the company over the competitors.
• Companies should be specific on their being eco-friendly, environmental and social responsible products, practices
and brand values. When how where are you ecofriendly? You have to rethink the whole process, not just a part. Ex.
No more plastic, ingredients are sustainable, distribution. Have to take into consideration the final product, the
process and the waste produced.
How much are you willing to pay to be sustainable? Normally it is more expensive.
What is the company really doing for the environment? Customers are expecting something more and companies are
trying to meet those demands.
Green washing: exaggerating the green attitude of the company regarding the products, the processes and the waste.
Ex. McDonald’s switched from plastic to paper straws, but they are not eco-friendly
Consumer ethics and responsibility: also the consumers should be responsible, are they opportunist? Is the company
communication transparent?
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5 CONSUMER BEHAVIOR
First analysis that the company does about the market, difficult to know bc the consumers change their opinions
and/or have multiple behaviors.
•
Motivation: why they buy (bc of needs, so generic that they cannot help)
•
Knowledge have the consumers of the products (software)
•
Tools of use: just to buy, computers, shops (hardware)
Tribal marketing: consumers analysis, consumers as a tribe, they buy bc they want to belong to a group, the link is
more important than the thing Ex. Harley Davidson drivers: gatherings, products, outfit, lifestyle..
If I know that my product is bought bc it belongs to a tribe, as a company I try to enforce this aspect: creating
gatherings, symbolic products…
There are many tribes connected to one product: old cars, vespa, bicycles, skaters, Nutella..
To satisfy the desire for community, people look for products and services less for their value in use than for their link
value. The products are the glue of the tribe and means of communication.
Tribe: Network of heterogeneous people linked by passion or shared emotion, capable of collective actions. Segment:
one part of the market that is behaving in the same way but they do not relate to each other
The tribal clover: there are “mythical” places for their gatherings.
– SYMPATHIZERS
– ADHERENTS or DEVOTEES (institutions)
– PRACTICIONERS (daily practice)
– PARTICIPANTS (occasions)
What we buy:
-goods and services: food, clothes, gym,..
-brands: Apple, Coca-Cola,..
-places: Venice, Fondaco dei Tedeschi,…
-culture: movies, books, museums, music,…
Different point of views: consumers can be seen simultaneously by different point of views
Consumers: individual, decision-maker, external element of the environment. This means that there are three
different elements that have to be taken into consideration
• All individual features:
-Needs, motivations, involvement
-Processes of exposure, attention and understanding (how perceive the brand from external suggestions)
-Knowledge
-Learning processes
-Attitudes
• Those that characterize him as a decisionmaker: emotions and rationality when they take a decision
-Problem solving and its phases
• And those that arise from its relationships with the various parts of the environment (sales, Christmas)
-Physical and social (hoe much I care about my friends)
-Macro: culture, subculture and social class
-Micro: target group, consumer community and family
=they create the consumer behavior and they make it different for every person and product.
Hierarchy of needs (Maslow)
-SELF-ACTUALIZATION
-ESTEEM
-LOVE/BELONGING
-SAFETY
-PHYSIOLOGICAL
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Needs are the base of motivation and they create wants (how to solve the needs)
Buying process
PRE-PURCHASE
PURCHASE
POST PURCHASE
-Problem identification
(perception of the need)
Exposure, attention and
comprehension
-Looking for info
Internet, retailers, malls,
window-shopping
-Alternatives evaluation
-Decision (chose an alternative
that better fit with our
expectations)
Attitude
-Purchase (us or we delegate to a
person that can make part of the
decision)
-Use
-Evaluation
Customers satisfaction (CS) and
evangelism (based on their
experience)
ex. You are sick, you go to the doctor and they tell you to buy medicines. You just buy them bc the doctor told you to
Ex. I am hungry, I choose to go to a restaurant, bar or just stay home
If the product evaluation is positive, the company has an ally in the market (better than advertisement).
In each part of the process they can make some actions: they can stimulate costumers, companies can create social
media, catalogues etc just to give information, help you to use the product with instruction,..
Sometimes the process can be interrupted bc the costumers decide not to purchase, but usually the costumers finish
the whole process.
Customer journey: important to be analyzed bc the company can increase the probability of the costumers buying
the product at every step.
• AWERENESS: I know that brand exist. But how can we increase it about the product and brand? PR (public
relations), Adv (radio, tv, print), world of mouth (most powerful bc it is an advice from the costumers)
• INTEREST: online ads, email, social ads, reviews, blog, media..the involvement of the costumers is growing
•CONSIDERATION (I could buy from this brand): the product could satisfy the needs. The company should create the
occasion to buy the product, the company creates the conditions so that buying get easier
•PURCHASE: e-commerce, website, store= omnichannel just to reduce the effort for costumers
•RETENTION: loyalty= advice. Community forum, FAQ, increase the knowledge base, how can I convince the
costumers to be evangelist about my product? To spread a good review of the product?
•ADVOCACY: promotions, blog, social networks, newsletter..
Consumer involvement: products can be more or less important, if they are important then we devote a big effort,
for non-important products we do not want to make an effort.
High involvement (make the effort, look for stores etc); Low involvement (the product is not worth the effort)
4 conditions
-Relevance of the product (personal)
-High risk perceived in purchase (how am I an expert in that product?)
-Symbolic value of the product (create the identity)
-Emotional value of the product (do I love the product?)
• Type of involvement
-Product category – brand (bags)
-Lasting or situational involvement (for a gift)
-Cognitive or affective involvement (logic)
Ex. Train ticket: not high relevant, risk maybe but still can be refunded, symbolic value= 0, emotional=0,
Life insurance: high intensity, high relevance, high risk and cognitive
Car: relevant, high risk (lot of money), symbolic and emotional value, high intensity but affective
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Dish soap: low intensity bc we do not want to make the effort, cognitive (only price and quantity are important)
There are three standards situations:
•EXTENDED PROBLEM SOLVING: high involvement, a lot of alternatives
•LIMITED PROBLEM SOLVING: look for some alternatives
•ROUTINE PROBLEM SOLVING: with low involvement, the most important thing is advertisement so that you can
make remember the brand, retail and distribution.
Depending on the consumer involvement, the way they buy is different. The journey is long or short, the process is
automatic or analyzed. Based on the involvement you have to use certain tools.
There are lot of factors:
-Psychological influences: not predictable, lifestyle, values, perception, motivation…
-Sociocultural influences: vary considering the social environments, in different cultures the actions taken must be
different. In international marketing you have to take into account the cultural differences. Family, social class,
reference groups..
-Marketing mix influences: where the company is acting on, so the 4 Ps
-Situational influences: during Christmas period there is a situation in which we spend so the advertisement,
promotions are pushed.
Consumer approaches:
•Economic consumer: in the old eco theory the consumer was considered rational in their decision. Companies try to
maximize the utility of the purchase and the personal satisfaction. (Price and quantity) Nowadays we recognize that
decisions are not completely rational
•Organizational consumer: buying for other consumers/organizations such family or company, they have a list and
there is a personal touch (high or low). If I buy for the family, I usually decide based on my preferences.
•Conditioned consumer: buys bc conditioned by advertisement, other persons. (low involvement)
•Psychoanalytic consumer: bc it depends on his psychological state (Freudian theory*)
•Social consumer: buying bc it is important for the group, what is social acceptable.
*Freudian theory, three different situations: three main psychological conditions that conflict and affect our
behaviors. Since there is the conflict, since we are continuously conflicting we stop, change opinion..
-ES: we want to follow the pleasure principle, we want to reduce miserable situations such as stress and so we buy
ice-cream, chocolate.. we buy immediately and we want everything at once. We buy something that we think is good
for us. Internal motivations
-EGO: reality principle, we buy something that is social acceptable (we are concerned what other are going to think
about us), we buy to be in the group. External motivations
-SUPEREGO: value principle (we consider what is ethical and not for us). Personal and valorian motivation
Purchasing risks:
-Physical: the product can be risky, the dimension of the physical risk changes based on the purchase
ex we buy a car and we feel a risk, we also choose options for our safety, if we buy organic food.
-Performance: especially for complex products, we wonder if the performance of the product is enough for our use.
Ex when you buy a laptop, you want the one that fit with your use; at the restaurants..
-Psychological: if I buy this product, will it fit with my identity? Will I still use it? Ex wedding dress
-Social: what others will think of me with this product? Certain products have a social value
-Financial: depending on the price and budget
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The company can try to reduce the perception of the risk: physical=adding tools or communicating how thinks work
or certifications, social= opinion leaders, influencers to give opinions, financial= secure payment, rates,
psychological/social= having a consultant that is a friend.
The consumer is changing continuously and the question is: Do we buy to have or do we buy to have?
When we buy to have something (rational functional use) we are price sensitive, low sensitive to service and we rely
on quantity mor than quality.
When we buy to be, we want to be someone through the product and the brand. Immaterial values > material
values, experience and service are important. Ex. The first refrigerator we buy is only a refrigerator, the second will
have more options and so on.. in the end in our society we buy more to be than to have.
But how many product do we know? Consumers are more and more experts because of the internet, once it was not
possible, you had to talk to the salespeople. Nowadays before buying a product you research the products and then
you find the opportunity, you go to the retail and costumers know more than the retailer (they have a lot of products
and they are changing a lot). This is only T when there is an high involvement for the product, otherwise you do not
make the effort. Being experts we create a different power distribution in purchasing.
If you are not an expert you rely on the brand, otherwise there would be no way to assess the products.
The costumers is an hybrid: buy to be, to have, expert, not expert, digital. The problem is that companies nowadays
do not anything about the costumers, so they analyze the costumers’ journey. Digital revolutions is changing the
behaviors, values and dynamics; so just because the costumers is an hybrid it is important to be omnichannel, have
promotions/ symbolic value.
Group influence: important when you are a child and a teenager (building your identity), in fact in adv they are never
alone, always a group.
•Reference group influence
•Family influence
•Social class influence
•Culture and subculture influence
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6 B2B COSTUMERS
How different are the organizations (as companies) as costumers? How are B2B markets?
MARKET CHARACTERISTICS
PRODUCT OR SERVICE CHARACTERISTICS
BUYING PROCESS CHARACTERISTICS
•Demand for industrial products and services is
derived (depends on the consumer behavior, final
market: success of Spritz with Aperol, company in
crisis before the success of Spritz, after the boom
of the spritz the supply of Campari increased the
sales).
• Few costumers, with larger purchase: if the final
market is increasing in 10%, then the B2B market
will increase more, if the final market is decreasing
1%, B2B stops completely.
•Technical products
•Many products purchased are raw or semifinished
•Emphasis on time delivery, technical assistance
and post sale service
• Since they are professional buyers, they are
functional, rational economic driven.
• When they decide to buy many parts are involved
bc the products they buy influence a lot of parts.
There is a purchasing group
• Decision time is very long and also waiting time
for important purchases
• Reciprocal arrangements and negotiation
•We wonder if the suppliers are reliable because
purchases are continuous or bc we need help with
the machines we bought for example.
• Relationship between the supplier (key partners)
MARKETING MIX CHARACTERISTICS
Buy class situation: New buy (people take decision, longer time) / straight buy (few ppl, short time) / modified buy
(moderate time)
As we can understand the suppliers are important, not only their product. “You are buying the company, not their
product”.
Online B2B markets: are made of marketplaces, forward and reverse auctions (Forward auctions: increase the price.
Reverse auction: the supplier reduces the price. Instead of one supplier and many costumers, you have many
suppliers and few costumers.)
Procurement: the action to buy from a supplier.
B2B is a professional situation: you are not buying the product, you are buying the partnership with the suppliers.
You trust your supplier. It is functional, less emotional, not completely rational (bc they are still persons)
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7 GLOBAL/INTERNATIONAL CONSUMERS AND MARKETS
Global or international company? Not clear choice, usually you are a mix of both, depending on the trend.
Global: when you have a single approach to all the markets. Technology, B2B markets
International: you are in different markets with different offers, + or - difference. B2C markets (communication
changes)
When is a company really international?
•Sales in other markets: national market ex is USA -> America, Europe->EU (have the same rules as a market). Sell
outside with an importer or with e-commerce.
•Branches: outside the domestic market, sales branches
•People: people of many nationalities, cultures
•Factories: when has grown a lot, the company may open factories abroad.
•Ownership: sometimes the company is owned by foreign company
There are different shapes based on the geographical situation, population, ecological footprint, GDP (gross domestic
product), tourist visitors, R&D.
Economic regions: being able to export without many taxes
•MERCOSUR: organization of the south America, it includes Brazil, Venezuela, Argentina, Paraguay. Not as integrated
as the EU, but they tried to create a common market
•NAFTA: North America Free Trade agreement; includes Canada, Mexico and US. More integrated than the Mercosur,
not as much as EU. Close relationship CAN-US, less but still there is US-MEX (factories in Mexico to reduce costs)
•ASEAN: Association of south-east Asian nations; economic region for trades.
•EU: free trade, political agreement. Most integrated region. There are a lot of countries that want to enter, but there
are specific standards that have to be met. (two countries out of the EU: Swiss and Norway)
Are there global consumers? In any place of the world the consumers want the same thing in the same way, do they
exist? It is difficult bc of the Price changes (taxes), so already the marketing mix (product, price, place, promotion) is
not met, so the offer is not met, the communication should be the same but what language? What media?
Distribution is not the same everywhere (local distribution): not global
Cross cultural approach considers different cultures in different countries
Culture influences behavior of ppl:
– Purchasing behaviors. In Italy you buy a lot of pasta, while in other countries don’t
– Social behaviors. Symbolic V of the products are perceived differently
– Business behavior. In trading, contracting, direct or indirect.
1. Low context = trading in direct way, business first
2. High context countries= nonverbal communication, building relationship with partners before B
– Language and communication change completely. You translate the meaning that you want to transmit
– Intercultural mktg. Global mkts doesn’t exist
– Global strategies exist to increase the value
– Intercultural negotiation. Increasing the value
Cultural contexts: different way of communications
 High context culture= a lot of cultural elements, if you understand the culture you get the message. Unwritten
rules of the culture. E.g. Japan
 Low context culture= word have exactly their meaning. Very direct comm, no misunderstandings. E.g. US
Hofstede model: 6 dimensions of culture affect the decision of managers:
– Power distance = how the culture accept the difference of power in a society, if you accept inequality
– Uncertainty avoidance= the degree of stress face to an uncertain situation
– Individualism VS collectivism
– Masculinity vs femininity = M (achievement, success, aggressiveness..) F (inclusivity, collective care)
– Long term vs short term
– Indulgence= satisfaction of life, enjoy and have fun
The Country of origin COO: psycho effect when consumers are unfamiliar with a product and the COO has a halo
effect on the evaluation of the product. We create stereotypes. The Made in is more and more false, bc the product
can be made everywhere (especially imp for luxury products)
What is imp is Design place -> where it is created ex apple is designed in US and made in China
How to enter in a particular country? Upsala model
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Starting from Export -> independent representative (importers or agents in the country)-> subsidiary-> open
factories = we increase market commitment and internalization. But when international standardize or customize?
Domino’s legend: standard customized pizza, customize to the local taste.
8 MARKETING RESEARCH:
Marketing information system MIS
-Internal information (invoices: administrative document in which we have a lot of info about the customers, sales
reports, customers complaints, meetings)
-Marketing intelligence (from external parties; competitive insight + market insight)
-Marketing research
-Marketing models: the way you analyze and organize information collected, software
MARKETING RESEARCH STEPS
Primary data: useful but
general info newly
collected for the project
(observations,
questionnaire)
Secondary data: already
recorded prior to the
project (internal and
external data)
QUESTIONNAIRE
It must be easy for the interviewee and the interviewer (funnel pattern - from general to specific)
short questions and direct (the subject must have the necessary information to reply)
Filter questions to better identify the target
progressive sequence (from the general to the particular, from simple to complex)
Questions about the interviewee placed later
Open, closed, semi-closed questions
Use of quantitative scale (1-5, 1-7)
Use of qualitative scales requires the support choice (verbal, numeric or mixed), number of categories (usually from 4
to 7) and the possibility of identifying a neutral category
Semantic differential categories with opposite adjectives eg. Traditional - Modern (evaluation of brand image)
Likert seven points that allows you to express your level of agreement / disagreement with a statement
INTERVIEW
2 persons each team (possibly M+F) One asks, one
writes
Asking for a very short interview
Polite and smiling
Giving a copy of the questionnaire to the interviewee
Showing a product sample
FOCUS GROUP
Analysing a market problem
8-10 people discussing freely on a topic
1 facilitator of the discussion
Recording the discussion
The sample should contain different attitudes not be
representative of the universe
SOCIAL MEDIA
Control social media
What they say about the brand
What they think about your product
Just to have an idea to how to create the
questionnaire and create the research
TEST AND EXPERIMENTS
Test should be given an opinion to customer (New
product / New market)
If they like the product it doesn’t mean they will buy
the product bc there are other distorsions
Competitive comparison: with competitors
Testing the sales system: chasing the shelves
Observing the consumer behaviors
MYSTERY SHOPPING= a way to get info about the retailer
Company send mystery shoppers. They play a role
Make some difficult questions to retailer
Behavioral analysis of the retailer
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Typical of mono brand retails or getting to know the situation about the competitors
9 SEGMENTATION AND POSITIONING:
Market segments: homogeneous groups of prospective buyers that have common needs and will respond similarly to
a marketing action. Different from other groups of buyers.
How can we segment the mkt ?
– Using personal characteristic; Young ppl/ female / students. Do they buy often?
– Expected benefits, fast, economic , hedonistic way. It is important what i expect
– Behavioral measures Ppl buy every day / week / month
There is not one way to segment the mkt. Many ways the companies choose:
– Geographically: segmenting by country, region, city size, density
– Demographically: gender, age , life circle
– Psychographic: lifestyle, values, personality E.g. if you have kids you spend for them E.g. couple. You buy
considering the other person
– Behavioural: retail type, usage rate, use status, awareness
Segmentation is also describing the mkt in the way you want
The problem is the segment is becoming more and more liquid = not stable, changing fast
Post-modern society: The same person can have different roles: parents, client, son… (Existential polycentrism)
Solutions:
-Case by case approach. You collect information and you define mkt needs. You customize the answer
-Cherry picking behaviour: different behaviours following the situation
SEGMENTATION BY “MOMENT OF LIFE”: different attitudes to purchase and usage
When you are on holiday you buy differently
E.g. Venice is segmented by tourism, price higher
Situation segmented: Aperitif time Lesson time Lunch time
SEGMENTATION STRATEGIES
– Homogeneous mk: everyone wants the same thing
– Mk segment proposal: expectation is the same but many proposals, in different countries you change a little
– Differentiated mk : different product, price etc… specific product for each segment
– Focused mk (niche strategy): you are a small company so you focus just on one segment
Product and segments: 1-1, 1-many, many-1, many many
B2B segmentation :
– Geographic segmentation: place of the world
– Demographic segmentation: industry classification
– Behavioural: usage rate
How to choose the target segment:
– Simplicity
– Cost of reach the segment
– Mkt size
– Compatibility
– Expected growth
– Potential of marketing action to reach the
– Competitive position
segment
We want to be noticed inside the segment. The positioning= the space occupied in the consumer’s mind
Expected benefit= the reason what ppl buy the product
3 concepts about position:
– Functional.
– Emotional. You like it very much
– Competitive. Better than competitor
Depending on the communication your position is different
The 2 main factors the company thinks are imp for customers are: price and quality
Position depends on the perception of the consumers have on competitors and company
Success of positioning:
Clarity: be simple
Competitiveness
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Credibility
Consistency
10 NEW PRODUCT:
What is a new product and how can we define it?
New product = smth does not exist before, new in the perception of the customer. Customers didn’t know the
product before
E.g: aeroponics: new way of growing vegetables. The way to make salad is new, it is an improvement
Vertical farming: It isn’t contaminated. It is inside
Sustainable growing: Only water and air.
They are totally new bc they don’t need to be washed. Shelf life is longer. You can have the product in every season
of the year
How to define the product is new? How do the company propose it as a new product? Bc for his kind of the food,
salad is the same
– Changing the packaging. Perceiving it as new
– Working on the name of the brand. Giving name communicating that has smth new. Product is a communication
product. You have to give the message that it is new
– Communication. Telling the story on the package in brief
– Distribution.
– Pricing. Asking for better price
New product: Perceived new by the consumers. It is positioned differently. Functional, emotional, social differences
CONSUMER LEARNING: 3 types of innovation
 Continuous innovation: improving continuously the product. Step by step the consumer learns how to use the
product. It asks for new behaviour. It needs time
 Dynamically continuous innovation. Disrupt consumer’s normal routine but does not require totally new learning
 Discontinues innovation. Requires new learning and consumption patterns by consumers. Increase the
knowledge
Reasons for failure or success:
– Relative advantage. Clear advantage
– It should be simple to use. Reduce the complexity
– Compatibility. E.g. capsules with coffee machines. E.g. electric cars with places for charging them.
– Trialability. I want to try it before deciding if the product is expensive. E.g Apple you can try their products.
– Observability. Machine not already done can be observable. Seeing it working
Traditional approach to NEW PRODUCT DEVELOPMENT:
1.Identify opportunity in the mkt
2.Design the product
3.Testing it
4.Launching it
5.Product management along PLC
Idea generation:
– Solving some mkt problems
– Users’ solutions, that are more effective
– Operations
– Patents. Patents office that proposes ideas
Company is continuously generating new ideas
– Management and employees. Salesperson can give
feedback from customers
– Technologies. Imitation is permitted, copy not
– Competitors
IDEA SCREENING; Condition of success of the product:
Company image
Pl
Customer service
Marketing
Finance
Procurements
R&D
Operations
=Evaluating all the characteristics and see the total score if is good for you
POSITIONING THE CONCEPT: when you generate new idea:
Knowing the mkt opportunity
You generate new ides
Core benefits proposition. Which are the core
Selecting idea
benefits
Position idea
Main dimension
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Which are the expected benefit for the customers
Positioning the alternatives
Product concept evaluation
E.g. : diet Nutella
 3 concept positioning :
Functional concept: spread chocolate acceptable in low calories diets
Communication concept: tasty, enjoyable during diet
Competitive concept: sugarless original Nutella
• Check list about the concept test, data collection
• Economic analysis: Cost price at y-axis, Sales at X-axis. BEP= turnover and cost are same
 Product test:
Employees: Not representative sample bc they know too much about the product
Customers will reach differently or Potential cosutomers: Blind test -> without the brand, knowing the product as
functional product /Non blind test with the brand with product (sometimes Not good idea making a test bc
competitors can see you, especially if the product is easy to be imitated)
Panel: Frequent launches
• Mkt test. Is it sure to be done ? Cost? Risky? Reliable?
When the product is unknown
we can use:
Advertising’s
Free samples
Coupons
Creating awareness
Product concept
Persuasion
Distribution
Price
Trial :
Product
Performances
=Adoption
====Summary
Opportunity in the mkt, ideal generation, selection product, positioning concept, testing, economic evaluation,
launch
11 PRODUCT MANAGEMENT:
Moleskin stop production in 1986
They found the value of the branding the story of the product and want to relaunch the product. It was very
successful bc of Memories, symbolic, emotional reasons. It became a lifestyle product
Revitalizing the brand: new way to taking notes, smart writing set, enlarging product range, merchandising, creating
promotional products, creating Stationery
The point is the brand. Starting from the notebook and then creating other things
PRODUCT LIFE CIRCLE: Consider the life circle of the product, in each phase there are different customers:
– Introduction. Explorers are customers that like to be the first buying the product
– Development. Product successful, buyers are pioneers, they have experience of buying
– Maturity. Majority of sales
– Early majority are first buy
– Saturation. Late majority, after buy
– Decline. Latecomers buy almost for the price is low. Cost per unit is decreasing
Different competitors
Many LIFE CIRCLE:
– High learning product: long introduction phase bc you ask customer to learn
– Low learning product: easy to adopt, introduction phase is short
– Fashion product: it enters in the mkt and then decline
– Fad products: short life time
Zara. Products for 3 weeks, changing products every season
Product range:
– Assortment breadth: different line of products
– Line depth: long or short line
Big assortment, the more difficult to manage
Big assortment bc you customize the product, you create many versions to attract the customers
Assortment analysis :
– Concentration : one product is making the most part of sales
– Complementariness: if you buy a product of that line, you’re interested in buying other products of that line
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– Gross margin
– Age: older the assortment , more risky is the mkt
12 BRANDING:
Brands are part of the offer of the company (both B2B, B2C).
Barbie (Mattel company) starting point of an entire product system. They understood that young girls wanted to be
adults, so they gave what they wanted. Communication with kids. Maturity when competitors entered.
Vans: a tribe of active people and they focus on skaters. They dress similar, they meet together, they have their own
language..the product is the linking product of the tribe
Starbucks: American perception of the Italian coffee shop, here the brands mean place (comfortable area, with
friends)
BRAND: Unique design, sign, symbol, words, or a combination of these, employed in creating an image that identifies
a product/company and differentiates it from its competitors. Over time, this image
becomes associated with a level of credibility, quality, and satisfaction in the costumer's mind
– Functions
– Name
– Logo (lettering of the name)
– Payoff (description of the brand in a few worlds, vision in 3 worlds) ex. Volkswagen: Das Auto, Kinder: -milk, +
chocolate; Nike: Just do it, Apple: think differently
Set of attributes and product values that are consistent with each other, appropriate, distinctive, protectable and
adapted to consumers' desires
Brand value: concerning the memory when you think about the product category
• Memory
• Value promise (every brand is promising value)
– Top of mind (ex Rolex)
– Expected quality
– Awareness (I remember it)
– Symbolic value (wealth, rich sport life)
– Suggested awareness (something that I know
– Performance guarantee
vaguely)
– Identity
Best global brands ranking: Internal branding: in computer we have the label “Intel”, the component is so important
that it speeds up the final product. 2000-2020: the digital economy completely changed everything. Apple, Google,
Amazon, Microsoft, Samsung..
IDENTITY PRISM: how can we discover the identity value of brand?
Sender: the company providing
Recipient: customer
Internalization
Externalization:
-Self-image: perception of himself when using it
-Physical dimension: colours, logo, image.
-Relationship: the way the brand creates relationship
-Culture (value system):
-Personality
with its customers,
-Reflection: identification model, profile of the
persons using the product
Ex. Apple: logo apple with the bite, white, round is more female, more lovely, strict relationship part of the identity,
unformal relationship, users are stylish, innovative, creative
Innovative easy-tech American
Ex. Cornetto’s identity:
-Physical dimension: tasty, easy to carry,
-Self-image:
-Relationship: informal social sharing
-Culture: Italian, young
-Reflection:
-Personality: self confidence
Symbolic brand (high involvement)(Apple) VS functional (low involvement)
Identity (how the company defines the characteristics of the brand, how it wants to be perceived) VS Image (the
perception of the costumers, how I actually perceive the identity I wanted to achieve, it is personal). Companies try
to make them overlap.
Levels of brands:
– Corporate: may include many other companies ex. Barilla is a corporation with many brands; there are also other
companies abroad
– Maker’s: ex LVMH then you have LV, Fendi, Bulgari, Tiffany, Guerlain..
– Umbrella /endorsing: ex Mulino Bianco (biscuits, cakes, bread), Pavesi from Barilla, many diff products
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– Line: products made similarly or used in the same situation Gilette
– Product: ex Mentadent, can be both part of the company or isolated
In general you have two alternatives:
• Corporate brand: every product has the same
company, acceptance of the brands
Reassuring customers. They know the brand
Accepting new products easily bc you know
Less communication expenditures
Stronger total image
E.g. P&G, siemen
• Product brand: isolated brands bc the product
identification is better, the name does a lot
Product identification is better.
Correct name
Consistent image.
Image isolation: if a product goes bad, there is no
problem for the other products. Pepsoment and
Mentadent Different positioning
Different brand values
E.g. algida, mentadent, lysoform, dove, cif, calve…
• Endorsed brands: they connect everything, their connection is lifestyle not the product. Virgin is a lifestyle
• Brand extension: Ferrari making cars but exploits the value of the brand and by making strollers, bycicles, sport
drinks, perfumes..check the quality of the products
• Co-branding: ca’ Foscari and credit Agricole= credit card, Complementarity of competencies difficult to develop
Strengthening the in introduction of the product Partial brand repositioning
Ingredient branding
Licensing : car of Gucci, Philadelphia of Milka
• Private label product
Retailer brand. E.g zara , decathlon, Ikea
Products are made by other companies
The brand is owned by the retailer. Private label are owned by retailers
They sell other brands and their own brands
Typical are the supermarkets
Private label are products of the supermarkets, which have a lot of other brands,
Companies produce for their own brand and for other brands
2 main advantages :
-Fulfil production capacity , reducing cost
-Making collaboration with private labels(retailers), retailers will assign space in shelves to them
Private labels are brand that you rely on
You buy them bc 2 reasons:
-Price is lower
-They consider their product low involvement
Recently private labels create for other brands
• Competition with manufacturers: Collaboration? Competition?
Price convenient
Private labels creates other brands
Bt retailers and manufacturers there is collaboration as well as competition
• Internationalization
Global brand
Same positioning
Same communication
Coca Cola , Ferrero, adidas
International brands
Different positioning
Different communication
They keep Local brand
They buy the brand but they maintain the local name
Different in every country
Country of origin effect: Positive or Negative. Psychological effect which occurs when you’re unfamiliar with the
product and based on stereotypes. Rely on general info
When the customer is unfamiliar with the product , the customer usually refers to the country of origin
E.g. fashion product -> better made in Italy, France. For cars -> Germany
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What customers expect from the product
Country of association: Coca-Cola is American brand but it is made everywhere; BMW Germany brand but it is made
in Austria, China, Indonesia, etc… Made in is not the county of origin. Made in is an old way to analyse the situation
of the mkt. The logic is Design
How does a country define its strength? Bc Historically many similar products coming from a certain country, they
have a lot of experience
The big success of a brand in a particular country creates the perception of the country of origin
E.g. the furniture country is Sweden bc of IKEA
In each country you have different perception. The country origin should be analyzed case by case in every country
Perception acceptable for ppl more easily
Perception advantage
Brand equity: how to define the value of the brand ?
– Cost-based. The value of my brand is connected with the amount of money needed to replace a brand
– Mkt -based. The amount the mkt is willing to pay for the brand
– Income based
Royalty relief : annual royalties a company could hope to receive it licences the brand
Premium profile: premium price comparing the product with product of other brand
Excess earning: the increase of the profit attribute to brand
The brand name Should be:
– Distinctive from others
– Consistent with the product
– Ease to pronounce
– Not too long
–
–
–
–
Easy to remember
Evocative
International. Understood internationally
Protectable. Not too generic
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13 DISTRIBUTION AND RETAILING:
Why do distributors do exist? To reduce costs, increase efficiency. If distributors don’t exist customers should go to
the producers. They collect the products from produces
Different level of distributors:
– Wholesaler
– Retailers close to customers
DISTRIBUTION CHANNELS:
1.Producer-> agents (just connecting function)-> retailer-> customer
2.Producer -> retailer-> customer
3.Producer-> importer
4.Producer -> wholesaler-> retailer-> customer
5.Producer -> agent-> wholesaler -> retailer-> customer
6.Producer-> consumer
DIFFERENT FORMAT OF RETAILING:
Depending on situations and different FACTORS:
– E-commerce
– Assortment dimensions
– Luxury shop
– Space size
– Discount shops
– Type of service
– Coffee machines, automatic selling
– Non store retailing
– Price level
Retailing strategy process :
– Creating retailing strategy
– You define the positioning of the retailer
– Create the retailer mix
– (Pricing, Location, Communication, Merchandise)
– How is the assortment and how do you prepare the goods for customers
– Marchandise management or Store management
Retail pricing
Store location
Retail communication
Merchandise
Retailing mix made by:
– Products and brands
– Services
– Price level
– Layout and display. E.g. positions of supermarkets are studied well to induce the clients to buy. How do you show
the place to the customers?
– Localization.
– Atmosphere
– Communication
– Assortment
E.g. : shopping centre
Different distribution STRATEGIES:
– Intensive distribution . Undifferentiated mktg
Your product is everywhere , low involvement product . Coca-Cola, Ferrero
– Selective distribution. Differentiated mktg
You increase the level of service
– Exclusive distribution . Concentrated mktg
Only one store has your product . High involvement product
– Push or pull strategy:
Push Strategy= push the product to the store and it is forced to sell the product . Company sell large quantity to
stores
Pull = pull the product from the store by the consumer. Company is a big brand, store ask for the product as required
by the customers
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MERCHANDISING: How to define the assortment to attract the customer to buy the product. Active presentation of
the good. Economic management of the good
– Assortment
– Layout
– Display
– Stock
Flagship store: they sell the brand, the experience of the brand,
Present the brand is the aim
LV: Atmosphere is different. Few products, to give perception of high quality product
NESPRESSO: They want to increase the quality and value of the coffee. Increasing the assortment
Creating luxury coffee stores. Creating a perception of the brand as a luxury brand
Apple: products that you can test. Good experience with the product
FRANCHISING is a way to increase the distribution of the product. The owner of the store is a local entrepreneur and
they have the property of the store and they hire the personnel.
There are some places that are more attractable for sales
Flexing and big stores (make the brand perceivable by the costumer)
Ex Illy, internalization by franchising: they want to keep the company perception, quality of coffee. They want to keep
the brand image under control. They have around 50000 bars selling their coffee.
They have a big competition (850 coffee producers), 150000 coffee shop and bars
Different formats: Core bar, Landscape bar, Transit bar, Community bar, Corner bar
5 year contract
They can help normal bar to improve their offer becoming an Illy bar= increase the level of franchising success
Also competitors use franchising
Espressamente Illy: Creating an experience with atmosphere
In different countries there are e-retailers making E-COMMERCE
They have the same business behavior: producers-> retailers(amazon, alibaba..)-> consumers
Increase the way to achieve the customer
Amazon is just connecting the customer to producer
It is paid for: Connection and Logistic(the real business of Amazon: delivering products )
They open recently also physical stores to have Omnichannel solution
What to do to animate the shop:
– Increase satisfaction. Increase value for the customers
– Reduce sacrifice. Decrease discomfort for the csomers. E.g. setting places in shopping canter
– Add surprise. Creating unexpected experiences for clients. It is costly and not easy
– From single channel commerce= store, wholesalers and phones
– Separate channel commerce = more than one channels. Mails, phones, store. More than one channel to reach the
clients
– Multi channel
– Cross channel
– Omni channel = Synergetic management of numerous available channel and customer touch point in such a way
that the customer experience across channel and the performance of channels is optimazed
At the beginning the retail was a Point of Sales. For the company retailer was a POS
POP from the pov of customers
Then you increase the value
Experience orientation -> point of meeting and, point of permanence (shopping malls )
Omnichannel when e-commerce is introduced
The adoption of e-commerce is increased in pandemic situation
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14 IMPLEMENTING INTERACTIVE AND MULTICHANNEL MARKETING
1 Creating customer value, relationships and experiences in a digital environment
Marketplace: physical place in which sellers and buyers meet to exchange goods
Digital marketspace: digital environment. It is important to have a marketing program that capitalizes on the unique value
creation and build relationships through a favorable customer online experience.
LEGACY COMPANIES: trace their origins to the traditional marketplace. They can either use the digital tech to attract and build
consumer relationships or not participate in the digital marketspace (Prada).
DIGITAL NATIVES: with marketspace origins, they always broaden their marketspace presence while also understanding the
future role of the traditional marketplace
Since marketing creates time, place, form and possession utilities; marketers believe that there are more possibilities of value
creation in the digital marketspace than in the physical marketplace. In fact customers can be approaches anywhere and at any
time, communication of the specific desires and customization is easier, getting the costumers the products/services to use is
accelerated. CREATE CUSTOMER RELATIONSHIPS
Interactivity and individuality are important building blocks for the creation customer relationships. Marketers and customers
interact and companies listen to their needs (opinion on the prices, info received, products and services). Customers must also
be considered as individuals and let them decide thee time of interaction buyer-seller.
INTERACTIVE MARKETING: buyer-seller communication, the buyer controls the kind and the amount of info received from the
seller. Characterized by tools that transform the info received from costumers into customized responses:
- Choice boards: digital systems that allows customers to design their own products/services, prices, delivery options..by
answering questions. As a result the company has a deep knowledge of the customers and is able to anticipate their needs.
(collaborative filtering: process that groups people together based on their preferences ex. Amazon: “who bought this item also
bought..”
- Personalization: generating content on the marketer’s website based on the specific individual’s preferences. “similar options”.
Concern about intrusion, need the permission marketing: consent (opt-in) of the customer to receive tailored emails and adv.
(companies have to assure to only send relevant info, to give a opt-out option and not to sell their personal data)
CREATE A COMPELLING ONLINE CUSTOMER EXPERIENCE:
time, place, form and possession utilities are only the starting point for the quality of the online customer experience (from the
first look to through the entire purchase decision process). There are 7 elements of website design to take into considerations:
- Context: website’s aesthetic appeal and visual design (influenced by the company’s business)
- Content: all info on the website (text, audio, video, pictures..)
- Customization: the ability of the website to modify itself based on each user
- Connection: links between the website and other sites
- Communication: dialogue between the website and the users (sales representative or chatbots)
- Community: user-to-user communications
- Commerce: website’s ability to conduct easy and quick sales transactions for products and services
Most of website do not include all design elements (context and content always), it depends on their goal.
2 ONLINE CONSUMER BEHAVIOR AND MARKETING OPPORTUNITIES AND PRACTICES
Online consumers are subsegment of all internet users that use this technology to research goods and purchase. There are 5
broad categories: apparel & accessories , computer & accessories (product info is important), automobile & auto parts (standard
products, price is important), books music and video (delivered digitally), health and personal care (regularly purchased,
convenience is important).
But why do they buy online?
1. CONVENIENCE: less effort, they can use bots to compare prices or features, 8 seconds rule (abandon if T>8s)
2. CHOICE: a lot of possibilities, choice assistance
3. CUSTOMIZATION (interactive and individualized info) and CUSTOMIZATION (personalizing the marketing and the buying
interaction for each customer)
4. COMMUNICATION: buyer- consumer, consumer-buyer and consumer-consumer. Web communities (people online that
exchange views on topics), blog (public accessible personal journal for an individual /organization), spam and buzz, viral
marketing (strategy that encourages individuals to forward marketing messages to others: messages can be hidden, content
can be so compelling that users want to share it, marketers can offer incentives)
5. COST: usually online products can be cheaper. Dynamic pricing: changing prices for products and services in response to
supply-demand conditions
6. CONTROL: consumers want to have all of their info before deciding, they need their own time
Cookies are computer files of the web visitor that the marketers can download (track visits to websites, preferences..). they are
used for behavior targeting: direct online adv from marketers to those online shoppers that the system recognizes as potentially
interested to the specific online adv.
Social commerce: using social media for browsing and buying
Subscription commerce: payment of a fee in exchange of products/services delivered on a recurring schedule (Amazon Prime and
Netflix)
3 CROSS-CHANNEL CONSUMERS AND MULTICHANNEL MARKETING:
Cross-channel consumers are online consumers that shop or buy offline.
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14 PRICING
Price is a proposal of the company describing the value of the company itself wants to deliver to the customer
Price and value should be consistent. This proposal can be accepted by the customers of refused.
Purpose of pricing strategy: connection to the rest of mk mix, 4 of 7P’s (product, price, place, promotion, process,
ppl, physical evidence).To ensure the price corresponds with the way we have positioned the product in the mk
Willingness to pay and ability to pay. Profit. Adequate income
Price support the objective we chose: define the value of the offer that should be acceptable for the customer and
profitable for the company
Pricing strategy: Price elasticity: to what extent if at all will a price change impact the demand for the product
3 types of pricing: cost-oriented, competitor oriented, marketing oriented
– Skimming or penetration strategy: combination of high or low price level and the promotional activity level
Strategic objectives (built, hold, harvest, reposition
Mkt characteristics: (pros and conts, high or low price)
Relationship bt the COST AND PRICE 2 type of relationship:
Cost is a price constraint
The cost should be a threshold of the price of the price, not the base= price should not be lower than the cost, how
higher than the cost depended on the perceived value, not the cost
The correct framework of the price should consider:
– Competition
– Perceived value of the customer
– Costs is the lower threshold
Particular cases in which price is based on costs:
– Cost plus case. In B2B case of customized product, summing the total units costs + a fixed fee or percentage
– Markup case. Retail mkt where the number of products are huge that would be impossible to define a competitive
and value-based price for products. Add a fixed percentage to the purchase price
– General framework: acceptable price should be higher than the cost
Then define the price objectives, elasticity of demand and price tactics want to create
PRICE ELASTICITY: percentage changed in quantity demand / percentage changed in price
How much the price level affect the demand of the product, 5 situations :
– Strong elasticity price demand. Decreasing the price, the demand grows
– Double sided situa. Quite elastic at the beginning while become riding under a certain threshold
– Rigid demand at the beginning and then the elasticity grows rapidly
– Rigid demand. Not increasing significantly even though the price decreases
– Prestige pricing= typical of luxury good. Increasing the price, the demand increases until a certain threshold, bc the
price is part the value of the product
PRICING OBJECTIVES:
– Profit: max current profit and manage the long run
– Mkt share = increasing the mkt share
– Sales revenues: you reduce the price bc it is
– Unit volume
connected to the purchase or another more
– Survival short time
profitable product
– SR
When launching new products 2 strategies :
– Skimming price. When highest price that early customers are willing to pay. Not easy to be imitated product Non
price-sensitive segment High price high value perceived, new and innovative product
– Penetration price=lowest price as possible Product easy to be imitated Price sensitive-segment, Economies of scale
PRICE TACTICS limited price decisions in time and dimensions :
– Odd-even price 99 instead of 100
– Bundle pricing more products in the package
– Yield management price. E.g. flight tickets change price hour by hour
Discounts connected with various situations, so are very flexible price decisions. Quantity, season, trade, cash, special
events, allowances, reductions)
Company can differentiate the price of the product considering time, place, importance of the customer
Place: price of the concert. The closer, more
Customer: loyal customer pay less
expensive
Time: early bird booking is cheaper
Reach acceptable price considering: value for the customer, competitors price , costs
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Finding the final price considering: price objectives, elasticity price demand, price tactics
15 INTEGRATED COMMUNICATION:
Integrated communication: you have to use more than one tool. Different tools, different way to create consistency in
communication
Communication PROCESS communication flow made by many steps:
Source/ sender: you have a meaning to communicate, encoding the meaning. A code can be a symbol, a gesture, a
sound, etc… if you use only ine code the communication is risky. By encoding you reduce the meaning. You have to
use many codes transmitting the same message
Channel. It could be social media, tv, voices. The channel can modify the massage. You modify the quality of
communication. In adv for ex only few seconds to send the message. So keeping the message simple
The receiver should decode the message. The message can arrive differently from the original message that the
company want to send. The way we understand the message is different
Feedback, feedback process to check if the message has been received.
The perception is different: perception mechanism used to reduce the effort. Using the selection of message in
advance it allows to simplify the decision making process. We decide before what we want to receive and what not.
Perception factors: internal and external
– Internal: more powerful than external factors Need. Perception of a lack. Negative perception. Powerful
perception factor but it is very personal.
– Interest. If you have an hobby you persive every info about that
– Curiosity. Psychological attitude
External : they can be used by the companies
– Dimensions. Big pictures more perceivable than small ones
– Movement. More attracting that stable things. Smth that changes, sign of danger, you have to control it. Video is
more attracting that pictures.
– Intensity. You focus on smth
– Repetition.
1.Selective exposure. We avoid some messages
2.Selective attention
3.Selective Comprehension. We don’t want to know the meaning
4.Selective retention. What we want to remain
Sometimes the message is so attractive that you forget the brand. The message should be respectful of the brand
Communication strategies 2: competitive strategies; development strategies
• Competitive: comparing the products
Gaining on competitors using competitive strategies
– Comparative= never say they are leader
– Financial= spend much money
– Positioning= position in different way the product
– Promotional= price is lower
– Imitative= imitate the leader
– Gaining on other company’s product= in some moment of life circle product you want to substitute the product
with a new one, before the competitors do it
Cannibalization = apple launch every year the product. Life circle is 1 year
• Development strategies:
– Reach new consumers
– Extensive strategies is used
– developing global demand with: individual action (one company) or collective action(many company )
– Mkt growth
– Creating new buying behavior
– intensive strategies is used -> changing use habits or new use
=Loyalty strategies
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A lot of communication tools can be used:
Product placement= using the product in a movie
Pr publicity
Advertising
Personal selling
Public relations
Sales promotion
Direct marketing
IMAGE depending on many tools, involve all marketing mix components:
Product
Price
Actions
Ppl
Communication
Distribution
Brand
Retail
Various stages: introduction, growth, maturity, decline
1.Introduction: to inform-> using publicity, adv, sales promotions…
2.Growth: to persuade -> personal selling to intermediaries, advertising
3.Maturity: to remind-> reminder adv, sale promotion, limited personal selling, direct mail. E.g. Coca-Cola do advs bc
want customers remember it
4.Decline: to phase out-> little money to spent on promotion bc you’re abandoning the product
Different effectiveness of different communication tools considering some factors:
– Awareness
– Comprehension
– Belief
– Purchase
– Re-purchase
– Advertising= effective in awareness and comprehension and re-purchase. Aim to create awareness
– Sales promotion: no effective in awareness, effective in purchase and re-purchase. You know the product and you
know the price is lower down
– Personal selling: effective in belief, convincing ppl and purchase
– Sponsorship and PR = similar to advertisement, Increasing awareness
– Web = comprehension, purchase and repurchase
– Social media: effective in awareness, not in comprehension, belief, purchase and repurchase is powerful
We have to use integration bt the tools bc they have different effectiveness in different communication
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16 ADVERTISING
Advertising concept: any paid form of a non personal communication about an organization, a brand, a product or an
idea by an identified sponsor. Just to inform about the product
Advertising GOALS
– Awareness
– Remembering the use of the product. Coca-Cola
– Changing the attitude in the use of the product. E.g. respecting the environment
– Changing the perception of the importance of the attributes
– Repositioning the brand/ product
– Increasing brand loyalty
How adv works:
You spend money to reach some threshold, to be perceived
Message perception
Overcome perceptual barriers
Reach a great number of target costumers
Create awareness
You reach the saturation, don’t spend more, lose money otherwise
=Adv effects on the demand, translation of the curve, change the slope of the curve (broken)
If you increase the quantity, if you increase the price you don’t lose customers
If you reduce the price you gain more customers
Low price , high sensitivity
High price, low sensitivity
RATIONALITY Adv use rationality
Consumer seek rational explanations in non-rational behaviour. 2 message levels:
– Rational text
– Emotional images
Communication which seeks to argue and convince the consumers with facts, proofs, evidence. Emotion are imp
One way that adv is working: customers need to justify the need of the product = Rational text + emotional images
Another way of using adv: effectiveness of adv in determined by the repetition, conditioning
Repeating many times, the adv giving a mechanical reflex behaviour, which is imp in low involvement products
Way of attractiveness
It should be suggestive in emotional way
Connecting the product through feeling and emotion
Membership: You choose the product bc you enter in a group, you feel good bc you are accepted by the group
Symbolic products E.g.: Nutella you buy it to stay toghether with others
Ways you doing adv:
– Tv radio
– Press
– Web mobile
– Outdoor
In every country different ways are imp
You select the media according to the audience addressed
4 I:
Interest: if adv is interesting
Information bout the product, consistency with the
strategy
Consistent with the identity
Impact: perceivable impact
4 C:
Comprehension: easy to understand
Credible
Consistency
Conviction : pp to but the product
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17 SALES PROMOTION:
Effective sales promotion should be:
CONSUMER
– Perceivable advantage
– Limited time
– Unrepeatable opportunity
TRADE, retailers:
– Motivating sales force
– Directly connected to sales
Many types of SALES promotion :
Coupons
Deals
Premiums
Contests
Sweepstakes
Samples
Loyalty programs
Point of purchase
Rebate
Product placements
SPONSORSHIP AND PR (Connecting a company brand with a organization, person, event... in order to increase
reputation)(Involving stakeholders and KOL in events in order to create a goodwill about the
company/brand/product) 1st one is typical in charity or sport champions, culture, social.
Technical sponsor = the sponsored is using the product. It is a proof the product is working.
Commercial sponsor: creating more awareness of the brand
Different categories of sponsor:
Title sponsor gives the name to event
General sponsor: he pays around 50% of the sponsorship
Official sponsor: 20-25% of sponsorship
Technical sponsor
Participant sponsors: small brands
STREET COMMUNICATION: exploit physical situation to increase communication concerning about your product
Communication ONLINE: opportunity many, connection anywhere
Search engine= when you search the key world you receive a list of answers and the first are sponsored. E.g. google
Social media: is the way ppl accept more than others, diff around the world
Google analytics: you can measure everything, immediate assessment of effectiveness, you can track the customer
journey
Adv platform, many types, you’re attracted by the images
Digital adv is growing fast
===Decrease in expenditure in adv in general
The only 2 increasing are: social media and online video
QUESTIONS OF 3 DIFF EXAMS: 30/35 min for attending students
1. Which are the main perception factors in the communication process?
2. Describe the main environmental forces affecting marketing strategies
3. List the four conditions for consumer involvement and explain them briefly
4. How should be a brand name?
5. Advantages and disadvantages of a *product brand* strategy
6. Which are the main steps of a marketing research?
1. Contents of the business model
2. Which is the connection of between the consumer’s needs and the marketing offers?
3. In which case and under which conditions is skimming pricing an effective strategy?
4. Identify each stage of the product life cycle, discuss the role of communication in the 4 stages of the PLC.
5. Describe the main codes of ethics
6. Retailing mix components
1. What are the conditions favoring the use of penetration pricing?
2. Goals, limits and main characteristics of a sales promotion.
3. Discuss the differences between traditional print media and social media with regard to audience reach, expense and access, permanence,
credibility, and social authority.
4. What is the difference between a marketing strategy and a marketing tactic?
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5. Identify each stage of the product life cycle and discuss the role of communication in the four stages of the product life cycle.
6. Describe the main reasons causing success/failure of an innovation
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