Core Marketing Principles and Strategic Management
Marketing Fundamentals
Marketing is an organizational function and a set of processes for creating, communicating, and delivering value to customers and managing customer relationships to benefit the organization and its stakeholders.
- Seller Market: Competition between buyers.
- Buyer Market: Competition between sellers.
Marketing Strategy and Goals
Marketing Strategy: Manipulating a target group’s behavior.
Marketing Goals: Economic and psychographic.
Strategic Direction:
- Market development and penetration.
- Product development (innovation, product variants).
- Diversification (horizontal, vertical, lateral).
- Cooperation (Horizontal: prod-prod; Vertical: supplier-prod; Conglomerate: prod-prod).
Market Development Stages
Markets are categorized as growing, stagnating, or declining.
Consumer Behavior
Maslow’s Hierarchy of Needs:
- Physiological (water, air, food)
- Safety (security, health, prosperity)
- Love and belonging (friendship, family)
- Esteem (status, recognition)
- Self-actualization (morality, creativity)
Consumption Types:
- Utilitarian: Satisfies basic needs.
- Hedonic: Consumption after utilitarian needs are met.
Homo Oeconomicus: The rational actor who always strives for maximum gain.
Customer Value: Perceived benefit (economic, functional) minus resources (monetary, time).
Consumption Process: Input (marketing mix, influences) → Process (psychological, learning) → Output (purchase decision).
Customer Typology
- Loyalists: Positive word of mouth.
- Defectors: Neutral feelings.
- Terrorists: Negative word of mouth.
- Hostages: Unhappy but stay due to monopoly or low prices.
- Mercenaries: Satisfied but lack real loyalty.
Market Research
The Research Brief: Must define background, objectives, target group, size, actions, methods, budget, and timing.
Research Methods
- Types: Category, market, communication, advertising effectiveness, concept tests, and behavioral studies.
- Methods: Desktop research, observational research, surveys (Pros: inexpensive, fast; Cons: participant fatigue), behavioral research, focus groups, and experiments.
Segmentation and Distribution
Segmentation: Subdividing a large, homogeneous market into identifiable segments based on behavioral, demographic, psychographic, or geographical differences.
Retail and Distribution
- Retail Types: Specialty stores, department stores, supermarkets, superstores, convenience stores, discount stores, and off-price retailers.
- Organizational Types: Corporate chains, voluntary chains, retail cooperatives, and franchises.
Distribution Strategies:
- Push Strategy: Producer to trade to customer.
- Pull Strategy: Producer to customer (bypassing trade).
- Forward Integration: Shop-in-shop, franchising, concessions, factory outlets.
Brand Positioning and Communication
Brand Positioning: Creating a unique image through design, symbols, or words to differentiate from competitors.
Benefits of Positioning
- Basic, economic, social, sensual-aesthetic, and hedonistic benefits.
Communication Strategies
Channels: Classic advertising (TV, print), new media (digital, email, social), sales promotion, PR, and events.
Buyer Readiness Stages: Awareness, knowledge, liking, preference, conviction, and purchase.
Positioning Analysis
Competitor Analysis: Analyzing the status of competitors to develop hypotheses regarding their next steps. Key areas include portfolio, price, distribution, and communication strategy.