2 - Consumer, Target market, Segmentation
MARKETING MIX VARIABLES
MICRO-ENVIRONMENT – actors in immediate environment that
affect RB’s capabilities to operate effectively in its chosen market
Competition – (Understand the SWOT of your enemy to stay ahead.) COKE,
PEPSI, ASDA, SCHWEPPES (8-6)
Customers – (MASLOW, TORA, BDP, all help you keep in touch with the ever
changing needs of customer) TWO WAY RELATIONSHIP FOSTERED WHERE
R.B. NURTURED TALENT AND REWARDED SUCCESS (6-1)
Suppliers – (PORTERS5, establish where power is) AVAILABILITY OF PRODUCT
PROVIDES CHALLENGES WHERE REGIONAL MIX HAS BIG EFFECT ON
PRODUCT TAKE-UP (10-2)
Distributors – (The influence of supply chain on product delivery) FORWARD
INTEGRATION! (3-5), VENDING MACHINES (4-3), OZZIE SHWEPPES DEAL
WITH COMPETITOR (4-3)
MACROENVIRONMENT – the broad forces that affect a
company’s capability to operate effectively
SEE PESTEL
TARGET MARKETING STRATEGIES
TORA – THEORY OF REASONED ACTION:
Undifferentiated Marketing (No strong differences in customer characteristics or
a lack of appreciation of a segmented marketplace)
RED BULL GIVES YOU WINGS IS A GENERIC MESSAGE
Differentiated Marketing (Segmentation reveals several potential targets, specific
marketing mixes are developed to appeal to each of them)
VISIBILITY VIA IN-CROWD GIVEN MERCHANDISE (4-1) BARS STREWN WITH
EMPTIES, SOME BARS DENIED ACCESS TO SUPPLIES (4-1)
SEEDING STUDENT CAMPUS WITH FREE GOODS (7-5)
SAMPLING FOR WORKERS AT TRUCKSTOPS, OFFICES, GYMS, BUILDING
SITES (7-2)
Focused Marketing (Identifying several potential markets but focusing on one
niche. Due to resource issues or market attractiveness)
Customised Marketing (Choosing individual customers)
a person's volitional (voluntary) behaviour is predicted by
his/her attitude toward that behaviour and how he/she thinks
other people would view them if they performed the
behavior. A person’s attitude, combined with subjective
norms, forms his/her behavioural intention
1-Identify strengths and weaknesses assoc with buying
brand.
2-How do others influence buying intention
3-Strengthen beliefs about a positive buying experience
4-Weaken negative beliefs about the consequences of
buying
5-Change their evaluation of the consequences of buying
the product
6-Add a new positive belief
7-Add a new positive normative belief
MASLOW- NEEDS, DRIVES, GOALS
Physiological (fundamentals of survival)
THIRSTY CLUBBERS (4-5), (7-3)
SEXUAL POTENCY OR PROWESS (11-2)
Safety (protectiveness)
SPORTSMEN USE IT TO CONCENTRATE IN DANGEROUS EVENTS, TRUCK
DRIVERS ON LONG JOURNEYS (2-5)
SAFER INTOXICANT THAN DRUGS (3-2)
Belonging (Accepted by those they respect
IN-CROWD WANT TO COPY THE HERO DJ (4-1)
CHOICE CRITERIA
Technical: attributes and benefits used in
selection
Reliability – PERFORMANCE ENHANCING
STIMULANT
Durability – SMALL CAN EASY TO CARRY
Performance – GIVES ME WINGS
Style/looks – CLASSY CAN, COOL TO BE WITH
Delivery –AVAILABLE WHERE IT IS NEEDED
Taste – YUK! BUT WHO CARES – COMPETITORS
USE THIS TO TRY AND GAIN A DIFFERENTIAL
ADVANTAGE
Economic:
Price: PREMIUM
Value for money: 70% OF THE MARKET THINK
SO
Social:
Status – IF YOU ARE INTO DANGER HOLD ONE
IN YOUR HAND
Belonging – ANTI-BRANDERS WET DREAM
Fashion - THE COOLEST PEOPLE IN THE
COOLEST ACTIVITES USE IT SO YOU SHOULD
TOO
Personal:
Self-image – IF YOU ARE EDGY BE SEEN WITH IT
Risk Reduction – IMPROVED REACTION TIME
Ethics - ANTI-BRANDERS WET DREAM
Esteem (A perceived high std relative to others, prestige, elitism, reputation)
YGEN WERE ANTIBRANDERS AND PROUD (4-5)RED BULL INCREASED THIS WITH
MYSTIQUE (11-5), (4-5)
SELF Actualization (self fulfillment for own sake)
SPORTSMEN AND CLUBBERS LEGAL HIGH (3-2)RED BULL BROUGHT PEOPLE TO
BRAND (5-2)
Why do they
buy?
What
are their
choice
criteria?
Understanding
Consumer buying
behaviour
BEHAVIOURAL SEGMENTATION
Benefits sought: different benefits from same product
FUNCTIONALITY SEEKERS: STAY AWAKE, CONCENTRATE (3-2)
PLEASURE SEEKERS: DRUG FREE BUZZ (3-2)
IMAGE SEEKERS: THE NEXT BIG THING (4-1)
Purchase Occasion: frequency and time of year
AVAILABLE IN CLUBS AND BARS AT WEEKENDS (4-1)
Purchase behaviour: targeting the innovators segment
IN-CROWD WANT TO COPY THE HERO DJ (4-1)
Usage: heavy, light or non users get different attention
HEAVY USERS IN CLUBS DURING 90’S (4-4,5)
IRISH IN 2002 WERE HEAVY WHY NOT YANKS? (10-2)
Perceptions/beliefs/values: if values are shared so are tastes
ANTI-BRANDERS GEN Y’ERS (4-5)
Psychographic Segmentation
Lifestyle: grouping by ways of living
CLUBBERS 80’S-90’S WERE EARLY ADOPTERS/INNOVATORS (4-1) (4-5)
MUSICIANS (5-4), DANCERS (6-3), ARTISTS (6-3), STUDENTS (7-5)
Personality: those who use purchase as a reflection of self expression.
The brand as a badge
ANTI-BRANDERS BUY IT AS A PROTEST AGAINST COKE ET AL (4-5)
IN CROWD SEEN AS USING IT FOR STATUS (4-1)
Profile Segmentation
Demographic
Age: 16-30 year olds Gen Y’ers (10-3), (4-5)
SEX: MIXED
LIFECYCLE: THRILL SEEKERS WITHOUT FAMILY TIES
Socio-economic
SOCIAL CLASS: NON-CONFORMISTS AND ME-TOOS (7-6)
Geographic
LOCATION: DIFFERING NEEDS IN DIFFERENT GEOGRAPHICAL AREAS
(9-1)
HALLS OF RESIDENCE, GYMS, BARS (5-3), (4-1)
How do
they buy,
what is
their
decision
process?
STRONG THEORY OF ADVERTISING - AIDA
Who is
important in
buying
process?
CONSUMER BEHAVIOR
Initiator: the one that begins the process. Info
gathered from this person will influence the
next step
BRAND MANAGERS AT UNIVERSITY (7-5) DJS
IN NIGHT CLUBS
Influencer: they collate the info and impose
their choice onto others
BAR STAFF IN CLUBS AND PUBS HAVE
INFLUENCE OVER THE LOCALIZED
CONSUMPTION TRENDS (XX)
Decider: The one with the ultimate financial
authority and power
BAR/CLUB OWNER WHO WILL BE
INFLUENCED BY THE WORD ON THE STREET
Buyer: The one that places the order
COULD BE SAME AS DECIDER – THE CLUB
OR PUB OWNER.
User: the one that actually consumes it
GEN YERS, SPORTSMEN, CLUBBERS,
TRUCKERS, BUSINESS MEN
ADVANTAGES OF
SEGMENTATION
WEAK THEORY ATR
Create
Awareness
Trial
Reinforcement
22
1 - Marketing planning and strategy
PORTERS FIVE FORCES
SWOT involves specifying the objective of the business venture or project and identifying the internal
and external factors that are favourable and unfavourable to achieve that objective.
Strengths: characteristics of the business or team that give it an advantage over others in the industry.
Weaknesses: are characteristics that place the firm at a disadvantage relative to others.
Opportunities: external chances to make greater sales or profits in the environment.
Threats: external elements in the environment that could cause trouble for the business.
If the threats or weaknesses cannot be converted a company should try to minimize or avoid them
1 SUPPLIER POWER
Cost of raw materials & components have affect on margin.
Higher bargaining power of supplier = higher costs to you.
1987-2000 FEW COMPETITORS LEFT RED BULL
DOMINANT (8-6)
THREAT OF FORWARD INTEGRATION BY RED BULL (3-5)
BYPASSING WHOLSALER AND GOING TO SMALLER
DISTRIBUTORS WHO THEY HAD MORE LEVERAGE OVER.
THIS CREATED A FAST TRACK TO MARKET (3-5)
SELF BELIEF THAT THEY HELD KEY TO BRANDED
MARKET (9-5)
BBC QUOTE THEM AS PORSCHE OF SOFT DRINKS (8-1
To reduce bargaining power of supplier- seek new sources of
supply, threaten to integrate backward into supply. Finding new
suppliers, designing standardized components that many
Suppliers are capable of producing.
STRENGTHS
WEAKNESSES
1) FIRST MOVER ADVANTAGE
1) TASTED BAD, LOOKED BAD (3-1)
2) BRANDED MARKET NOT GENERIC (9-5)
2) OUTCOMPETED IN CERTAIN REGIONS (9-1)
3) TARGETING GEN Y’ERS WITH DISPOSABLE INCOME (4-5)
3) MARKET GROWTH REDUCED TO SINGLE DIGIT (10-1)
4) SHORT DISTRIBUTION CHAIN & INTEGRATED MARKETING (3-5) 4) LIMITED PRODUCT RANGE REGULAR, DIET, WATER (10-4)
5) CONTRASTING LOVE VS HATE BRAND
5) GOING MAINSTREAM LOSES CORE MARKET (11-2)
6) STRONG LIFESTYLE BRAND – PSYCHOGRAPHIC SEGMENT (5-2) 6) EXISTING USERS GROW OLDER AND CONSUME LESS (10-3)
7) MARMITE LIKE BRAND LACK AMBIVALENCE (3-1)
7) NON PATENTED RECIPE ENCOURAGES COPYCATS
8) 70% MARKET SHARE NO NEAR COMPETITIORS (2-1)
9) REGIONAL BRAND COACHES USE LOCAL MARKETING MIX (8-5)
CONVERSION STRATEGY
10) BRAND ALIGNMENT WITH TECHNOLOGY JAGUAR F1 (11-3),
FLIGHT
(11-1),
PLAYSTATION)
2 NEW ENTRANTS
MATCHING
New entrants can raise level of competition, thereby reducing its Opportunities
Threats
STRATEGY
attractiveness. HIGH MARGIN ATTRACT COPYCATS (8-6)
1) NEW MARKET OF 16 YR OLDS NEEDED TO REPLACE DRIFTING
1) ANSOFF – PROD DEV (10-4)
INDIRECT COMPETITORS IN ADES AND POPS (9-4)
STUDENTS WHO HAVE CHOICE IN COMPETITOR BRANDS (10-3)
2) BCG – DEFEND STAR, USE BUILD –(8-6)
The threat is governed by key barriers to entry:
2) BACKWARD INTEGRATING SUPERMARKETS (8-6)
3) LEGAL HIGH (8-1) – PROFESSIONAL SPORTSMEN
Economies of scale, Capital requirements to set up the
3) LOSS OF MYSTIQUE (11-2)
4) SEX POTENCY (8-1,2) (11-2) – GOLDEN GEN
operation Expected retaliation by the incumbent
4) SAFETY CONCERNS (8-3)
5) MEMORY AID (2-5) - STUDENTS
TRADEMARK INFRINGEMENT RETALIATION (9-5)
5) GOING MAINSTREAM (11-2),
6) USA SHOULD MIRROR IRISH CONSUMPTION (10-2)
To reduce the threat of new entrants – take out patents and
6) NEW MARKETS MAY REJECT IT (9-1)
7) BRAND AWARENESS WITH CAR RACING FANS (11-3)
tying up suppliers and/or distributors. DEDICATED
8) BRAND ALLIANCE – CADBURY UPTICK (4-3)
SALESFORCE (3-5)Build a strong brand that will attract loyalty 9) SOAPBOX ADVERTS , FLUGALS (11-2) GOLDEN GEN
and repeat buying
10) ESTABLISHMENT CREDIBILITY (11-1) MUSEUM VISITORS
3 BUYER POWER
11) FURTHER EXPANSION INTO AFRICA? (5-1)
CONVERSION STRATEGY
Bargaining power is greater with little differentiation, or fewer
buyers than sellers,
ANSOFF –
ASDA threat of BACKWARD INTEGRATING with own
The output from the Ansoff product/market matrix is a series of suggested growth strategies that set the
brand of drink(8-6)
direction for the business strategy. Often used to
CONSUMER BACKLASH – WIPEOUT 2012 a blatant anti1 MARKET PENETRATION-Maintain/increase market share, secure dominance, drive out competition
antibrand event (7-4)
by aggressive re-pricing, loyalty cards.Use when-market NOT saturated, there is growth in the market,
competitor share is falling, increased volumes supports Economies of Scale, scope for selling more to
4 THREAT OF SUBSTITUTES
same people
Devaluation of the brand by substitutes, lowering of market
2 PRODUCT DEV -New products into familiar markets, augmented offerings, endorsement, trials for
attractiveness
usersUse when-firm has strong R&D,growing market,rapid change, competitor has better products,can
CHEAP IMITATIONS (9-3)
REDUCED BY DISTRIBUTION ALLIANCE WITH RIVAL (4-3 easily build on existing items
3 MARKET DEV-sell into new geographical area, packaging, channel, segment
5 INDUSTRIAL RIVALRY
Use when-firm has excess capacity,new ventures beckon, attractive channels exist to enter new markets
Intensity of rivalry is dependent on market share
4 DIVERSIFICATION -Related Diversification-beyond current market but broadly within same industry,
BULL HAD 86% MARKET SHARE rivalry was low (8-6)
builds on assets/activities familiar to firm
MORE INTENSE FOR 23 NEWBIES fighting for 14% (8-6)
Unrelated Diversification – total departure from current markets/products/industry mix.
COMPETITIVE BEHAVIOUR
COMPETITORS
BOSTON CONSULTING GROUP GROWTH-SHARE MATRIX
It is based on cash flow – not profit!
More market growth: adverse effect on cashflow due to need of investment in plant and marketing to finance
growth.
More market share: positive effect on cash flow as profits are related to cash flow.
Build Market Share: Make further investments (for example, to maintain Star status, or turn a Question Mark into a
Star.)
Hold: Maintain the status quo (do nothing)
Harvest: Reduce the investment (enjoy positive cash flow and maximize profits from a Star or a Cash Cow)
Divest: For example, get rid of the Dogs, and use the capital you receive to invest in Stars and Question Marks.
PESTEL - Factors that influence
markets and customers
RedBull BCG – STAR INTO COW
Political: Changes in policy, warfare, civil unrest. Impacts consumer confidence. Taxes,
Build: Sales and/or market share
interest rates, spending power.
2001 WAS TOP 5 BRAND IN AFRICA AND EUROPE (5-1)
BANNED IN FRANCE & DENMARK ON HEALTH GROUNDS (8-3)
EURO AS A COMMON CURRENCY OPENED MARKETS
Economic: Rate of growth, inflation, savings, exchange rates. Impacts consumer demand,
more saving, less spending in tough times
1990 – 2009 – WORLD ECONOMIC GROWTH
£2.5B DRINK BUSINESS – 70% SHARE (GROWTH SLOWING) (2-1)
£1.26B GLOBAL SALES IN 2003 (3-4)
Social/Cultural: Where people live, social classes, cultural values, beliefs and subgroups.
Marketing approach changes as different types are receptive to varied things.
RELIGION – ADAM & EVE ADVERTS (11-2) SEX – LIQUID VIAGRA & BULLS BALLS (8-1)
DRUGS – LEGAL HIGH LIQUID COCAINE (8-1) ROCK N ROLL – MUSIC LOVERS (5-4) (6-1,2)
DEATH – IRELAND AND SWEDEN UNSUBSTANTIATED LINK (8-3)
AGEING – CHASING 16 YEAR OLDS TO UNIVERSITY (10-3) (7-5)
REBELLION – ANTIBRANDERS (4-5) (7-4)
REGIONAL – TARGETTING BY LOCAL BRAND MANAGERS (8-5)
IRISH CONSUMPTION MODEL IN US (10-2)
Invest: to maintain/increase leadership position
35% TURNOVER IN MARKETING/SPONSORSHIP (5-2)
Defend the market leader position: the case for RB
KEEP MESSAGE FRESH & INNOVATE WITH PLAN (8-5)
MARKETING PLANNING PROCESS - ONGOING
Business Mission: A BROAD STATEMENT THAT SEPARATES RB FROM OTHERS AND STATES THE
REASON FOR THEIR EXISTENCE- To build mystique in the product, build a branded market, provide
support to our partners & customers, sell not just a drink but a way of life (11-5), (5-2)
Marketing Audit: MACRO/MICRO ENVIRONMENT & INTERNAL AUDIT.
Where are we now? MARKET LEADER (70% IN 2004) (2-1)
How did we get here? By bringing people to the product. (5-2)
Technological: New products, services, work methods, communication methods, and ways
Where are we heading? GLOBAL
of distribution. Impacts the way the message is put across and the receptiveness to innovation
POSITIONING IN COMPUTER GAMES (7-4)
SWOT: An evaluation of the current business position – see above
INTERNET BUZZ MARKETING (
Objectives: The output of audit and SWOT feeds this
ASSOCIATION WITH F1 RACING, AIR TRAVEL, HIGH CLASS FOOD VENUES (11-1,3)
Strategic Thrust / future business direction-ANSOFF SAYS DIVERSIFICATION (10-6)
Environmental: Climate change, natural weather patterns, peoples attitudes to these major
Strategic Objectives for each product – BCG SAYS BUILD THE STAR
global factors. Impacts attitudes and creates new needs to be satisfied (organic food) weather
Core Strategy: Once objectives are set the means for achieving them are needed
events create opportunities (insurance – floods)
Target Markets: GEN Y’ERS – USE SEGMENTATION (4-5)
ANTIBRANDERS (4-5) (7-4)
Competitor Targets: COKE, PEPSI ASDA (2-1)
LUNAQUA – MADE FOR NEW AGERS UNDER GLARE OF FULL MOON (10-5)
Competitive Advantage: Better performance through DIFFERENTIAL ADVANTAGE over the
SUN, SEA SAND = SURF COMPETITIONS (5-3)
competition.
AIR, SKY FREEDOM = PARAGLIDING, SKYDIVING (5-3)
Being better: 70% market share 2004 (2-1), Being faster:Swift localized marketing and
WIND RAIN SNOW = KITEBOARDING, SNOWBOARDING (5-3)
Legal: legislation and laws that govern the way business can be done. Impacts customer rights, distribution (3-5), Being closer: Hands-on (7-1), 2-way relations (6-1), peer networking (7-5)
Marketing Mix decisions: Use of the 7P’s to provide a superior offering to customer at a fair price
legal action
use of POSITIONING to align the product in the minds of the consumer
EUROPEAN UNION UPHOLD FRENCH BAN (8-3)
TRADEMARK INFRINGEMENT (9-5)
Organization & implementation: Style of execution of the plan and structure of the function
FERTILITY CLAIMS SCRUTINISED BY REGULATORS (11-2)
Control: Reporting and monitoring.