Implications Introduction 01 10 2012 PLC product life cycle Price set artificially high because its new to the market Little competition price high Advertising awareness behavior by establishing positioning Positioning how we want consumers to see a certain product Promotions retail incentives Growth stage instead of sales increasing gradually there will be a spike in sales This increase in sales will increase in competition Increased competition decreases price Having choices is good for consumers but not for companies Primary demand product category phone Selective demand specific brand within a category iphone droid Advertising stimulates selective demand Promotions sampling coupons etc Maturity Blowing balloon hardest part is beginning like maturity eventually it ll blow up Intangible benefits Price may become the major form of competition Advertising maintain position intangible benefits Promotions costumers become loyal to just the price because they don t see the difference between one tuna brand from another We hope product has long maturity like Coke Pepsi McDonald s Decline If its too costly to turn the product around management will pull it off the market Steep price reductions to get it off the market Advertising low support Wont spend too much on advertising Promotions low promo no need to invest too much on it because we are trying to get rid of supply left Can t stop a product immediately it takes time Issues Concerning the Company Goals and philosophy Financial resources what is the company s bottom line Production capabilities advertisement that creates demand over the production capability is a waste Ex Best Buy PC must match advertising Distribution where are items going to be sold Advertising geography Product portfolio avoid product cannibalization each product in your company should compliment each other and not compete with each other Ex proctor gamble own Gillette and Braun both compliment and don t compete bad example Gap and Old Navy they clash and complete too much because product lines are not diverse enough If consumers don t see much difference they eat into each other Example McDonald s snack wont compete with their other meals Macro Issues Large scale issues which the company has not control over but they still have to deal with or influences the company 1 The economy unemployment rates interest rates stock market company cant control these factors Ex Allstate takes bad times and tells us that they will protect us 2 Legal Issues legal restrictions in the market place 3 Size if the Market How large is your market What s the growth potential Baby Boomers causing increase in adult homes depends denture paste etc now 4 Suppliers Natural resources when workers go on strike and you cant get resources to build your product Or tsunami in Japan when we couldn t get workers supplies parts to make cars 5 Societal Issues how roles change in society Example mad men women s role were just to satisfy her husband Example Gay Orbitz gay instead of spending money on family spends it on self 6 Seasonality seasonal buying pattern Your strategy should focus on strategy patterns Example back to school shopping promotion when its back to school season not randomly 2 broad types of research Primary and secondary research When you do not have a large research budget the best time to use the money is during the situation analysis You have to have the right foundation Secondary Research 1 Secondary research info gathered for some other purpose but is still useful to us Example titles census All pubic records Advantages inexpensive rapid comparative data large sample size reliable when its gov data Tells us how much they are selling but doesn t answer WHY Disadvantages rarely fits our need for info dated info not timely widely disseminated everyone has access to it not a competitive advantage Primary Research Customized research designed to accomplish specific goals 1 Tied to the hierarchy of effects tells us about our awareness attitude behavior 2 Consumer Information services example live chat 3 Classifying consumer maybe there is a market we haven t tapped into Maybe we should offer incentives to students if it s a college town 4 Message Strategy is it effective Objectives Positioning Objective goal to measure accomplishment What the company wants to achieve Provides strategic direction Obj why pos how DAGMAR Defining Advertising Goals for Measures Advertising Results 4 elements to DAGMAR 1 Task change increase awareness in target group soup 2 Audience who is ad supposed to reach age 20 30 3 Degree amount of change to achieve within the target group ex 10 most important 4 Time amount of time to achieve certain change with in a target group Length of campaign by 2013 it s critical that objective is quantifiable measurable Degree of change has to be like the bar you want to jump over 1 10th of 1 is not enough Benefits of Specific Advertising Goals 01 10 2012 Benefits 1 People do better work when they have a clear goal 2 Keep advertising on a target Subtle differences in age would change objective for ad You may have a great idea but it doesn t involve increasing awareness 3 Provides a common goal between PR Ad media etc If everyone is working from the same goal most effective outcome 4 How do you know you ve accomplished something Specificity permits measurements You have to have a specific goal to know if you have achieved Ex if you want to lose weight you measure how much you want to lose to see if you achieved your goal or not Brand Positioning how we want our brand perceived Relating to a competition through a unique and meaningful benefit Ex Nissan Sentra competition is Honda Civic Lets say Sentra has 1 64th handle larger than Civic makes it unique but its not meaningful Just because its unique doesn t mean you ll build an ad around Differences have to be BOTH unique and meaningful Perception is reality in advertisement Nike they don t sell a specific product they sell the image Ex if you try 5 pairs of shoes with no label you wont be able to identify which is Nike But you always buy Nike for the image Ex Dodge Craftsmanship Man Ship A car by itself is just metal advertiser s give it its personality through brand positioning Consumer perception If a consumer does not perceive that a brand delivers a benefit then that brand does not deliver that benefit Perception Reality Ex McDonald s for salad We think of McDonald s for burger s fries and Coke not healthy food We
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