COMM6026 Lecture 2 - marketing principles

1

Marketing Public Relations: Principles and Practice (2012/01)

Lecture 2

Marketing Principles

Developed and Presented by

Roy Ying, Msc., B.Comm.

Note: Pictures used in this power point file

is for academic Purpose only

DA010 - Professional Diploma in Public Relations - COMM6026EP

2

Is Marketing just the 4Ps?

3

Class Discussion

• Product– What is the most important factor in deciding what

product to sell?

• Place– What is the most important factor in deciding where to

sell your product?

• Price– What is the most important factor in deciding how

much you can charge for your product?

• Promotion– What is the most important factor in deciding what

you need to do in promoting your product?

4

There is the 5 Ps

5

This is essentially the 5P Model

PEOPLE

6

• 4 Ps plus…

• People are crucial in service delivery. The best food may not seem equally palatable if the waitress is in a sour mood. A smile always helps.

• Processes are important to deliver a quality service. Services being intangible, processes become all the more crucial to ensure standards are met with.

• Physical evidence affects the customer’s satisfaction. Often, services being intangible, customers depend on other cues to judge the offering. This is where physical evidence plays a part.

There’s the 7Ps in

service marketing

7

8

What’s 9 P?

• Purpose – Know the “why and what.”

• People – Engaging with customers and their engagement with you is priceless. You can learn so much.

• Processes – It should include a strategic marketing plan which feeds into the business plan for the company, and a marketing budget.

• Philosophy – You also often share your philosophies with the world.

• Packaging – More and more important as the global market place is now your competitor.

9

Which marketing mix to choose?

• It depends on how much control do you have on your business scope

10

Class Discussion

• Identify one type of company, and name one example, in each of the company orientations

– Production

– Sales

– Innovation

– Marketing

11

A simple marketing system

12

Sales vs Marketing Orientation

Sales:

• Heavy reliance on promotion activity to sell

products/services the company wanted to make;

• Aggressive selling tactics;

• Promotion consumes a large share of the

company’s overall budget;

• Inside-out thinking (If we build it they will come);

and

• Short-term planning.

13

Sales vs Marketing Orientation

Marketing:

• Consumers/Customers less willing to be persuaded;

• Consumers/customers are knowledgeable about the market and the products/services available;

• Companies identify what customers want and tailor all business towards those wants/needs (in an efficient manner);

• Marketing vs. just selling (i.e. management of the 4 Ps, not just promotions);

• Product input before selling (Alpha testing, beta testing, trials, etc); and

• Medium to long-term planning

14

Chief Marketing Officers Care

About Customers Most…

15

Customer Focus Marketing Mix

• Customer is the main focus point of the marketing mix.

• Consumer-oriented activity: Marketing mix’s purpose is to give satisfaction and pleasure to consumers.

• Four Ps of sellers correspond to four Cs of customers: Four Ps in the marketing mix represent the sellers' view of the marketing tools available for influencing buyers.

16

Interview with Coca Cola’s CMO –

customer engagement

17

Consumers remind us every day that Coke

is THEIR brand…

Facebook “2 Billion photo

uploads a month - nearly 70

million a day…” USA TODAY 8/09

On Facebook alone we’ve got:

- 4,600+ photos

- 95+ videos

- 500,000+ “likes”*

- 90,000+ “comments”*(*just in the last 6 months)

18

Availability

Ideas/

Suggestions

Advertising

“Biggest

Fan”Other

Coke Products

General

Comments

Low Post

VolumeHigh Post

Volume

Positive Conversation Tones

Negative Conversation Tones

General comments about the brand and

other Coke products are top topics…

“Coca-Cola is the best drink!!!! I love it...”“Coca-Cola is the best drink!!!! I love it...”

“ALWAYS COCA-COLA!! funny add from

Coca-Cola with Grant Theft Auto!”

“ALWAYS COCA-COLA!! funny add from

Coca-Cola with Grant Theft Auto!”

“. . . Bring back the glass bottle it makes a difference”“. . . Bring back the glass bottle it makes a difference”

“Anyone know if 'Kosher Coke'

is available in Colorado??”

“Anyone know if 'Kosher Coke'

is available in Colorado??”

“I adore cola! I can drink it every day :D”“I adore cola! I can drink it every day :D”

Consumption Habits/

Addicted

“i am the # 1 fan. just ask anyone who knows

me.”

“i am the # 1 fan. just ask anyone who knows

me.”

“DIET COKE IS WHERE IT'S AT

YA'LL!!!! :)”

“DIET COKE IS WHERE IT'S AT

YA'LL!!!! :)”

19

Our “Fans First” Approach: We will be Everywhere Our Consumers are in an Authentic “Member of the Community –

Non BIG Brand Way”

19

Our approach is designed to foster equitable engagement to earn

sustainable relationships that are authentic, delightful and reciprocal.

Being a Fan, Friend or Follower does not mean that they opted in to have

advertising blasted at them.

Enabling Fans to Comment, Upload

and Consume THEIR own consumer

generated brand related content

Strategically targeted messaging in

support of our brand objectives

Majority

of our

efforts

20

Coca-Cola “official” Social Communities…

20

21

How to connect customers?

22

Listen to your customers

• Customer surveys

23

How Starbucks do research?

• What consumers think about Starbucks

• How consumers feel about Starbucks by asking 4 ‘P’s of marketing

• E.g. We ask about affordability of Starbucks to find out consumers perception on pricing of Starbucks products

24

4 ‘P’s: Price• Pricing approaches

� Value-Based Pricing (good service, quality); NOT Cost-Based Pricing (mark-up too high)

� Competition-based pricing e.g. The Coffee Connoisseur

• Comparing with competitors� Similar price ranges

� More benefits to impress consumers

• Product mix pricing strategies� Product-Line Pricing (Coffees, Teas, Ice-blended drinks)

� Different prices due to different cost prices

• Price adjustment strategy� Psychological Pricing (higher-priced products = higher quality)

• Consumer responses on Starbucks’ Pricing� Affordability of Starbucks

� Paying for Quality or Quantity

� Whether Starbucks is value-for-money

25

4 ‘P’s: Promotion• Marketing communications (promotion) mix• Advertising

� Reminder e.g. location of new outlet� Informative e.g. new flavors of beverage

� Persuasive e.g. guaranteed satisfaction for consumers

• Sales promotion� Advertisement specialties, contests, premiums and coupons

• Public Relations� Community relationship e.g. Salvation Army donation

� Invited celebrities

• Direct Marketing� Facebook

• Marketing Communication Objectives• Consumer responses on Starbucks’ Promotion

� Whether more promotion is needed� Type of promotion

� Type of advertising tool

26

4 ‘P’s: Place

• Number of Channel levels�Uses direct marketing channel: Starbucks outlets

�Also uses indirect marketing channel: Bottled frappuccino

• Channel Intensity�Selective distribution: Kraft, Pepsi

• Number of outlets, locations, etc.• Consumer responses on Starbucks’ Place

�Convenience of Starbucks

�Whether ambience of location of Starbucks affects patronage

�Starbucks to be intensive or selective distribution

27

4 ‘P’s: Product• Levels of Product

� Core benefit, Actual product, Augmented product

• Classification of Consumer Product

� Shopping products (SQPS)

� Limited extensive advertising; available in limited number of stores

• Brand Positioning

� Product attribute: Organic coffee

� Product Benefit: Caffeine

• Brand Sponsorship

� Licensed brand

• Brand Development

� Line extension: Short, Tall, Grande and Venti

� Brand extension: Merchandises e.g. tumblers, bottles and mugs

• Consumer Responses on Starbucks’ Product

� Starbucks is the preferred brand

� Quality of Starbucks products: 8/10

� Packaging of Starbucks products: 6/10

28

Conclusions &

Recommendations• Starbucks coffee is a premium

coffeehouse that focuses on quality in the way that it position itself.

• More advertising

• Update packaging

• Stronger branding needed�Create distinctive product benefit

�Or expand brand extension line / Go into multi-branding

29

Collecting Feedback

• Pre-launch events

30

Social Media Campaign

• 1,000 free breakfasts

31

Group Project

• Due date: Lecture 10

• Group Presentation

• All group members earn the same score.

• A hard copy as well as a soft copy of PPT

• Oral presentation should be 15 – 20 min long.

• Team 1 will ask team 2 a couple of questions, who will in turn ask team 3….the last team will ask team 1 questions.

32

Group Project - Topic

• Pick one brand from

• Each team mustpick a differentcompany.

Full report available at: http://www.millwardbrown.com/BrandZ/default.aspx

33

Group Project – Content

requirements

Part I

• Conduct a review of the company’s marketing public relations activities– News articles about the brand

– Exhibitions that they or their vendors participate in

– Popularity of the spokespersons of the company

– Special events organized by the company

34

Group Project – Content

requirements

Part II

• Give recommendations on how you think the company can do a better job in 2012 so that the brand will be worth more, and that consumers are willing to pay a premium to buy their products.

35

Group Project – Grading criteria

1. Research effort on selected company

2. Demonstration of understanding of MPR concepts

3. Feasibility of recommendation

4. Presentation skills (i.e., content planning, slides preparation, use of visual aids, and delivery techniques)

36

Dos and Don’ts in presentation

• Don't think about "delivering a speech".

• Don't try to recite from memory.

• Don't read word-for-word from a stack of papers.

• Instead, think about "talking to people”.

• Use visuals to help you explain, not as

substitutes for explanation.

• Be aware of the time!

• Take questions in the middle, not at the end?

37

As a presenter, you want to ask:

• What’s your point?

• What’s your point?

• What do you want them to remember?

• What do you want them to remember?

• What action do I want them to take?

• What action do I want them to take?

• If I am one of the attendees, will I want to stay?

• If I am one of the attendees, will I want to stay?• Why did

they bother to come listen to me?

• Why did they bother to come listen to me?

38

What has Steve Jobs done right?

39

Why were you able to pay attention?

40

What was his main objective?

41

This is what NOT to do!