Marketing in briefs

The Gist of Marketing

The thing that stuck for me after thousands of hours of post-graduate study, reading marketing journals and books was understanding that you cant wing it. If a firm intends to measure the success of a venture by seeing the first quarter of sales results then it is already too late. Knowing enough about the consumer, their needs and product markets should provide insight and adequate forecasting from the beginning. A lot of product managers try to remember this and do it properly, but they might not know how without adequate marketing experience.

Many companies, often start-ups and small enterprises, make the mistake of working backwards where they release a product and see how it performs. It is vital to remember that research should reveal customer preferences before buying decisions do. A smart company conducts ample market research and releases a product that consumers need or value. Regardless, things can always go wrong so stick with a data-driven MVP.

The General Marketing Must-Knows

  1. The layperson’s (and my favourite) definition of marketing would be meeting consumer needs profitably.
  2. Marketing tasks are developing strategies, capturing insights, connecting with consumers, building strong brands, shaping market offerings, delivering value, communicating value and creating long-term growth.
  3.  Know the common types of markets such as product market, service market, demographic market and geographic market. Types of popular segmentation variables such as demographic, psychographic and behavioural.
  4. Understand what value is and the meaning of value proposition. How to choose a value through segmenting, targeting and positioning. How to provide value through features, price and distribution while communicating the value through promotions and advertising.
  5. Since the foundation of marketing is to meet consumer needs it is vital to know a few needs models. You are likely familiar with Maslow’s hierarchy of needs. A model relevant for marketers today is the five types of consumer needs. They are stated needs, real needs, unstated needs, delight needs and secret needs. For example if someone like myself were to buy a car a stated need would be that I want a car, the real need is it should be cheap to operate, unstated need is wanting great service (not dealing with pushy salespeople) from the dealership, delight need would be if they didn’t charge me for any colour but white or included optional extras and secret need would be to have all my friends see me as a savvy consumer with a respectable Tesla automobile.
  6. Know the environment; the task environment such as suppliers, distributors, customers, and competitors. The external environment for which PESTEL is the popular model of choice, the abbreviation is for political, environmental, sociocultural, technological, economic and legal environments.
  7. The production, product and selling concepts. The production concept looks for low cost and mass distribution. The product concept looks to meet needs, usually with innovation while the selling concept requires undertaking aggressive selling and leads to product provincialism. Product provincialism is a fancy term for when the focus of the company is the product and not the consumer. It is kind of a no-no in most cases but still popular for commodity type products.
  8. Competitive advantage! It is basically something a firm can do that the others cannot easily imitate. VRIO is a popular model to determine competitive advantage. It stands for Valuable, Rare, Inimitable and Organised; those are some characteristics of competitive advantage.
  9. Understand the difference between Point-of-Parity and Point-of-Difference. The terms are kind of self-explanatory but important to keep in mind. Things in which you can match the competition are points-of-parity whereas ones in which you excel are points-of-difference. A successful company intends to turn competition’s points-of-difference into points-of-parity by matching their offering while creating points-of-difference of their own that cannot be copied easily.
  10. How to assess growth opportunities. There is intensive growth, integrative growth and diversification growth. Think about the stage and life-cycle of a firm while assessing growth.
  11. Porter’s generic strategies: Cost leadership, differentiation and focus. I prefer the value disciplines by Treacy and Wiersma which are operational excellence, customer intimacy and product leadership. They are similar in more ways than they are dissimilar so look up both.

The Not General Must-Knows Mostly About Market Intelligence and Research

  1. Results data vs happenings data. Think of it as sales information versus what people are doing on Twitter information.
  2. Market research process which includes the problem statement, sourcing data, analysing and testing to conclude with presenting the findings. Remember that collecting data is the part most prone to error keep in mind “garbage in, garbage out”.
  3. Measures of market demand such as potential markets, available markets and penetrated markets. Bonus points if you know how to estimate current demand, total market potential and total area potential.
  4. Decision-making unit such as buyer, user, initiator, influencer, decision maker, gate-keeper.
  5. Learn all the generic differentiation strategies such as employee, channel, image and service differentiation.
  6. Expansion strategies such as penetration, new market, geographic expansion.
  7. Competitive strategies like leaders, followers and nichers.
  8. Protective strategies which include innovation, position defense, flank defense, preemptive defense, counter-offensive defense, mobile defense, contraction defense.
  9. Challenging strategies such as frontal attack, flank attack, encirclement attack, bypass attack, guerrilla attack.
  • If all the former strategies sound made up then please be assured they are real and you must study them if not to use them then to outsmart competition who may be using them.

The Consumer Behaviour Must-Knows

  1. Factors affecting consumer behaviour such as cultural factors, social factors, personal factors and psychological processes.
  2. Customer perceived value (CPV) which is the difference between total consumer cost and total consumer benefit. The costs can include things like psychological cost, time cost and the obvious monetary cost. Likewise, the benefits can include service benefit, peace of mind benefit, image benefit, feature benefit. Make sure the costs and benefits are specific to your business because some of them might not apply.
  3. Approaches to spotting trends – seeing future as an extension of the past, searching for cycles and patterns, analysing actions of consumers, monitoring technical and social events, discerning trends from the above.
  4. The market funnel which is unaware, aware, open to trial, trier (non-rejecter), recent user, regular user, most often used, loyal consumer. Think about how you can build loyalty and how you can identify consumers based on their needs and their value to the firm.
  5. The five steps of the decision process which are problem recognition, information search, evaluation of alternatives, purchase decision and post purchase behaviour. The evaluation of alternatives is a key area where good firms succeed. A consumer moves from the total set, awareness set, consideration set to a choice set for making a decision while evaluating alternatives.
  6. Decision heuristics such as availability, representativeness and anchoring and adjustment heuristics or biases. Also, think about framing, consumers are loss averse thus how the choices are presented can be a determining factor on whether the product is successful.
  7. Adoption process which is awareness, interest, evaluation, trial and adoption.
  8. You should know the product life cycle.

The Must-Know Branding and Old-School 4P’s

  1. Brand and what it consists of (awareness and associations). Knowing what brand equity means for your firm is important. If people make decisions on price then too much emphasis on branding may be futile. Brand equity can be measured through loyalty, revenue, vulnerability to competition and responsiveness to marketing communications. There isn’t an agreed way to put a number on this as far as I know. Some people consider brand equity to simply be the amount of money it would cost to create a similar brand from scratch.
  2. For branding decisions and performance it is good to understand the BCG and GE matrix. However, the former are not specifically branding tools but to evaluate product portfolios.
  3. Positioning is a tough one. It can include determining a frame of reference, points of parity and difference and brand associations and creating a brand mantra to summarise positioning. There are two main authors worth studying one is Keller and the other is Rossiter who thinks positioning has three levels micro, meso and macro.
  4. Understand depth, width and length of a product mix. Know the difference between line and brand extension. Remember how new products are developed – it goes idea generation, idea screening, concept development and testing, marketing strategy development, business analysis, product development, market testing and commercialisation.
  5. Pricing strategies like optional-feature pricing, captive-product pricing, bundling pricing, loss leaders and the like, they all serve their purpose but I cannot stress enough that your product is worth what the consumer is willing to pay for it.
  6. Place or distribution strategies require understanding the value network and knowing whether push or pull marketing (maybe a bit of both) would be effective.

Further Reading

The textbook used in most MBA programs is Framework for Marketing Management by Kotler and Keller

Hooked by Nir Eyal
Made to Stick by Chip and Dan Heath
Misbehaving by Richard Thaler

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