New Market Tribes, Distribution Strategies, and Marketing Trends
TOPIC 1
1.- Using topic 1, explain the different types of “New tribes” that can be found on the market, and choose a brand that could identify each one. Explain the reason for your choices in each case.
- BOBOS: ‘’Bourgeois Bohemian’’:
- They belong to the capitalist and urban world, Liberal professions,sophisticated and consumerist style.
- They do not buy expensive brand-name products, but opt for high quality, organic, fair trade and handicraft products.
Ex: Patagonia is known for its commitment to high-quality, sustainable, and ethically sourced products, aligning with the BOBOS’ preference for organic, fair trade, and handcrafted items.
- ADULTESCENTES O KIDULTS:
- in their 30s now… but dress and behave like 20s, work but many have not yet left the family nest.
- spend a lot of money on video games, electronic products, branded clothes, sporting goods…
Ex: LEGO ha logrado mantenerse relevante entre los adultos al lanzar colecciones destinadas específicamente a ellos, como sets complejos de arquitectura, colaboraciones con franquicias populares (Star Wars, Harry Potter, etc.)
- DINKIS:
- “Double income”, no kids,they don’t want to.
Ex: Apple ofrece productos tecnológicos de alta gama como iPhones, iPads, MacBooks y Apple Watches, que son populares entre consumidores con mayores ingresos debido a su calidad, diseño elegante y funcionalidad avanzada
- PROSUMERS:
- “Producer + Consumer”
- no longer spectators of life receiving one-way advertising messages.
- internet users and not only buy a particular brand, but also generate information about it through social media and comments on online platforms.
- Interaction.
Ex: GoPro’s products encourage user-generated content and interaction, fitting the prosumer profile of actively creating and sharing media.
- INFLUENCERS:
affect the purchasing decisions of others because of his or her authority, knowledge, position, or relationship with his or her audience. The size of community the size of people they get to
Ex: TIKTOK is a key platform for influencers to share content and engage with their audience, significantly impacting purchasing decisions.
- SINGLES:
- goal in life is no longer to get married and have children, but to enjoy being single.
- “single” is the new way to catalogue a wide range of products and services at his or her disposal that are focused on this niche market.
Ex: Tinder offers singles a wide range of dating opportunities and social interactions, catering to their lifestyle of enjoying singlehood.
- ALPHA WOMEN:
- Natural leaders, self-confident, enterprising, independent….
- With executive positions of great responsibility and present in political life, companies, businesswomen
Ex: Lululemon es conocida por su ropa deportiva de alta calidad y estilo, enfocada en el rendimiento y el bienestar. Esta marca no solo ofrece productos que cumplen con los altos estándares de las Alpha Women en términos de funcionalidad y moda, sino que también promueve un estilo de vida activo y saludable
2. -Using topic 1, explain the difference between Inbound vs Outbound Marketing.
Inbound marketing is the customer who searches for the brand thanks to interesting content they have seen about the company. Traffic organic and not by payments, plus is a cheaper way and results are medium-term
Examples:
- A company writing a blog post about tips for using its product.
- A travel agency sends a monthly newsletter with new promotions to different destinations
Outbound marketing, also known as traditional marketing, aims to impact target audience through paid advertisement. The traffic we attract to out site is paid and results are short-term
Examples:
- Tv commercials during a programs,Print advertisement ( street publicity),Radio advertisment
3.-Explain Generation C and its characteristics.
GENERATION C Characteristics:
- Age doesn’t matter matter to them
- They interact with the world digitally
- They are growing
- Attract their attention is difficult
- Global connections
- Change in what they give value to such as health and body care; increased individualism; they develop an awarenes to ecological topics, concern about climate change and respect the environment.
- New social tribes appear: dweebs, kidults, dinkies, singles, prosumers, alpha females, influencers…
4.-Identify and explain the differences between Omnichannel and multichannel
strategies.
- Multichannel: all channels not themselves integrated.
- Omnichannel: all channels and are connected.
What is an omnichannel approach in retail?
An omnichannel strategy is when a brand is present in several channels at the same time, as in the multichannel format. However, the difference of omnichannel in ecommerce is that it aims for full integration between all channels.
Key differences:
Omnichannel: customer experience, customer centric, quality of customer support.
Multichannel: customer engagement, customer centric, quantity of channels.
TOPIC 21.-What are the different types of distribution depending on the market product coverage and what kind of products are they associated with? Explain an example of each.
Types of distribution
- Direct
Direct distribution is when manufacturers sell and send their products directly to consumers without the intervention of third parties or entities and deal directly with its end customer.
Example: A door-to-door Sales.
Example: Tesla a sells its electric cars directly to consumers through its own branded stores and online platform. There are no third-party dealerships involved.
ADVANTAGES
- It is easier to keep your identity as a brand.
- enjoy higher profit since are not intermediaries
- Direct distribution gives companies more control over the whole process.
Indirect
An Indirect distribution strategy is usually made through third-party retailers or other direct-to-consumer channels. Indirect distribution involves third parties, like warehouses, wholesalers, and retailers.
Example: Coca-Cola Coca-Cola uses a network of bottlers and distributors to get its beverages into various retail outlets, such as grocery stores, restaurants, and vending machines.
BENEFIT:
Indirect distribution may allow companies to focus on their core business while outsourcing distribution to an expert.
(*) Hybrid. Hybrid channels combine the characteristics of direct and indirect channels. The seller uses both direct and indirect methods. For example, a manufacturer might sell an item on its e-commerce website, but then an intermediary delivers the physical product to the customer.
Intensive distribution
A manufacturer can choose to penetrate the market by selling its goods to as many places as possible. most used (convenience products).
Example: chupachup
CHARACTERISTICS
- They involve a wide range of products.
- They require significant stock and high requirements in volume.
- massive sales.
- Constant stock renewal and difficult to manage.
- high level of advertising and promotion (mass marketing).
- The channel is difficult to control.
Selective distribution
small number of distributors and implies the fulfillment of certain requirements by the intermediary, without being obliged to be exclusive.
purchase of certain minimum quantities and recommended volumes. There is no obligation to sell only our product.
Example: Yamaha wide range of product
- Limited channel
- Risk because you can buy and sell competing products
- Risk to brand image
- High investment in the channel
- Controlled economic flows
- High dependence on the channel
Exclusive distribution
The manufacturer grants the intermediary the exclusive right to sell in a certain market area or territory in exchange for not selling competing products. High sales effort, technical assistance and repair services.
Example: Rolex Watches
- Planned and thoughtful purchase decision.
- Risk to brand image.
- Channel dependency.
- Increased loyalty.
- Limited positioning and growth.
- Possibility of instalment purchases.
- Important after-sales service
2.- Difference between internal and external growth.
Expansion through internal growth: Internal growth occurs by opening and expanding through new shops with the company controlling the movements, where the new locations are of interest, ideal to start expansion in a controlled way. It helps us get to the desired positioning.
External growth: This growth is based on the purchase of other companies that are competitors and that have a strong local presence, e.g. in the food sector, buying companies that are well structured and sized in a territory.
Alcampo , acquired Sabeco, created Simply which is now Mi Alcampo (Alcampo Supermarkets). External growth is very expensive but it is much faster.
The possible limitations that we can find are:
- The difference between the brand image of the buyer and the one bought,The cannibalization of clients when working in the same area, High purchase and integration prices
3. Explain an example of Vertical integration strategy, and what are its main
Vertical integration strategies allow a company to streamline its operations by taking direct ownership of various stages of its production process rather than relying in external suppliers. Market control by the manufacturer
- Concentration of purchasing,Economies of scale and logistics ,Presence of specialists
Horizontal diversification
A company seeks to add its existing lines new products that will appeal to its existing customer
Market expansion, risk reduction, economies of scale, brand leverage,etc (ex , el corte ingles)
4. What kind of distribution strategy is being developed in the image below? Pull
or push strategy?
The image shows a type of pull strategy. Indeed, Primark became valuable to the eye of the consumers for its low prices and by opening a new store, Primark increases its brand image and attracts more customers. Thanks to Primark’s marketing, customers themselves demand the products.
PUSH
consists of placing a large quantity of product among distributors, so that it is the distributor himself who encourages its sale.
Downstream strategy: from the manufacturer to the consumer. Focusing communication efforts on the distribution companies to achieve the following goals: Efficiently distribute products: Buy in large quantities, Preferred placement at the point of sale, Retailers to recommend our brands to distributors.
PULL
consists of carrying out strong communication campaigns, so that the consumer himself demands the product from the distributor.
Upstream strategy: from the consumer to the manufacturer. Focusing communication efforts on the buyer by using advertising and promotion through the mass media; and so: That the consumer demands our product at the point of sale.
TOPIC 3 1.- Difference between wholesaler and retailer.
Retail – Definition
The retail trader or retailer is the one who sells the goods to the final consumer. Final link in the chain. They can influence, enhance, slow down or alter the marketing actions of the manufacturer or wholesaler.
1. Retail sale of goods or services
3. Sizes and quantities needed by the consumer
4. In certain cases, grouping of different products and qualities,they can offer transport, installation and after-sales service and they can offer consumer financing
Wholesale trade with an establishment – Definition
The wholesale trader is an intermediary characterized by selling to retailers, other wholesalers or manufacturers, but not to the consume or end user.
Characteristics
- Purchase of goods from the producer or from another wholesaler.
- Grouping and standardization of products.
- Transport of the goods
- Storage and preservation of the products
- Promotion and sale of the products
- Delivery to the retailer or other wholesaler
- Credit to customers
2.-What is a Marketplace. Indicate two positive and negative points.
Marketplace -What is a marketplace?
It is a type of eCommerce that allows several sellers to interact with buyers to make a commercial transaction.In these platforms, buyers and sellers remain in the technical and commercial environment of the marketplace until the transaction is finalized. (ebay)
2 poitive things :
Increase exposure and customer reach, attract large number of visitors, providing sellers with an access to a broad audience withour needing to invest heavily in marketing.
Reduce operational cost: the platform handles aspects logistic, payment ,security,etc that the brand doesn’t have to worry about
2 negative points
There is a high competition, there are numerous sellers offering similar products, leading to intense competition
Dependency on marketpolicy that can change unexpectedly and can be risky for the company
3.-What are the main disputes between franchisor and franchisee.
A franchise is a type of business arrangement where a franchisor (the original business owner) grants the rights to use its trademark, brand name, and business model to a franchisee (an individual or entity). The franchisee operates their own business using the franchisor’s established systems and support in exchange for an initial franchise fee and ongoing royalties or fees. This arrangement allows the franchisee to benefit from the franchisor’s brand recognition, proven business methods, and support services while expanding the franchisor’s reach and market presence.
Main disputes between franchisor and franchisee
- Buy only from the franchisor
- Training and advice
- The franchisee manages on his own
- The franchisor does not respect the geographical area of exclusivity
- The investment of the advertising fee
- False viability of the business
- Franchisee does not attend training courses
- Franchisee does not pay the periodic fees
- New clauses when renewing the contract
- Problems with the master franchise
- Non-transparency of the parties
- Franchisee becomes independent and opens a similar business
TOPIC 4 1.-Define and explain the DPP (Direct Product Profitability), What type of management would be the most appropriate to apply after this type of analysis.
The DPP approach, direct product profitability, is a cost analysis aimed at detecting the profitability of each of the company’s most important products, with the aim of improving their logistical management, changing the packaging, transport, storage, etc. systems if necessary, as well as being able to make tactical and strategic decisions in the market we are targeting (looking for optimization).
2.-Which kind of Marketing Trend is being implemented in the following image?
This image represents social marketing. Indeed, Coca Colca used an external and social problem, which is climate change and applied this problem to change their products and become more sustainable and thanks to that, improve the brand image, here by using plant-based material for 30% of the bottle and empathize that the plastic bottles are recyclable. The strategy is to help the brand but also the social problem they are pointing at.