E/ME 105 Lecture 3 Marketing October 3, 2006Mission StatementSince last weekWhat is Marketing?What is Marketing? 4 Ps of MarketingImportance of MarketingSome good attributesTechniquesConsider in turnSlide 10Slide 11Slide 12Marketing ResearchSlide 14Slide 15Slide 16Target MarketsSegmentation- continuedBarriersAfter approval of your Mission Statement. . .ScriptMarket segmentationThe Technology Adoption Model as the Basis for Segment FocusThe New Idea Adoption Model in the developing world as the Basis for Segment FocusSlide 25Generate Hypotheses & Identify Underlying AssumptionsRecruit Interview TargetsFor the real customerInterviewOpen Ended Interview QuestionsCompetition“Competition”StakeholdersE/ME 105Lecture 3 MarketingOctober 3, 2006Mission Statement 2 minute Team Mission PresentationsDue on Thursday. Send in ppt 1 hour before classSince last week•Friday phone conversation with Landivar–They are working on the developing world barriers thought process –We will meet with them by Skype on Thursday mornings•They may be one lecture behind at the end of the week but they will have seen the Tuesday Lecture and the Thursday ppt.–Tried Adobe collaboration product•Not impressed–Teams formed?What is Marketing?What is Marketing?4 Ps of MarketingProcess of planning and executing•Product •Promotion•Pricing•Place (or distribution system)of ideas, goods and services to satisfy customers True for developing world as wellImportance of Marketing•Perhaps the single most important failure mode in the product development process–Sloppy research (confirm prejudices)–In development, not really understanding the customer•Poor communication•The “Margaret Mead” effect–Ephemeral nature •Not in an equilibrium state–(right wrong)–Poorly coupled to design•Treated as a separate activity–Too well coupled into design•Constant changes in specificationsSome good attributes•Strong Customer involvement–Customer cares–Customer has “pain”•Can define market segment (to be discussed)•Market growing•Competitive advantage•OthersTechniques•Interviewing•Polling•Working together to a common purpose•Filming•Other?Consider in turn•P1 Product –Needs identification–How product would actually be used–Context discovery–Brainstorming of concept–“Chilero” or coolness– Modification of existing product for new marketConsider in turn•P2 Pricing–What the customer can afford–What value does the product bring–What financing arrangements are possible?–What is the price of a competitive product?–What price is necessary to return a profit?•What is the reason for keeping the price as low as possible?•How does the cost effect the price (don’t confuse!)?•Is it “immoral’ to earn a “fat” profit?Consider in turnP3 Promotion–How do you make the customer aware of the existence of the product?•Word of mouth•Brochures pictures?•Demo at market•Someone use it for free•Product advertises itself•Radio –Evangelical stations•Use Saturday loudspeakers•Door to Door•Use local languages–How can you generate excitement about the product?•Pizzazz•Personal experiences- testimonials•Promotion lower price•Celebrity endorsements football players, community leaders, church leaders–What are the costs of Promotion•Need to budgetConsider in turn•P4 Placement (Distribution)–How do you get the product to the customer?–Consider where it will be manufactured–Consider who will sell it? (effect on price!)–Consider how you get it to the person who will sell it–Consider how it will be maintainedMarketing Research•Primary Research–Original research - data collected from the target market•Secondary Research–Meta research- data collected from literature, internetWe have defined a third research classificationProxy research–Research through knowledgeable third parties•People with first hand experience in the specific marketMarketing Research•Primary Research–Original research- data collected from the target market•Landivar students lead here–Use in-country contacts (NGOs, professors, other students)•Use teleconferencing•Interview people from indigenous villages in LA?•Other?Marketing Research•Meta research- data collected from literature•trade association data •industry publications and databases•“Economist” and other publications •government databases (e.g., US Dept of Commerce, State Dept, Guatemalan trade) •UN, NGO databases•Other?Go quickly from general to particularMarketing Research–Proxy research- data collected from people with first or second hand information•Mentors•Returning Peace Corps volunteers•Returning NGOs•Landivar partners•Others?Target Markets•Who are the people who will use your product?–Geographic •Location, climate, population size and growth rate–Demographic •Age, sex, ethnicity, income, occupation, education– Psychographic•Life-style, activities, interests, opinions–How will they use product (use patterns)?–What benefits will they derive? •Do for–Primary market- the first market addressed–Secondary market- the next market(s)Segmentation- continued•Psychographic variables –life-style–Activities–Interests–Opinions–product use patterns–and product benefitsBarriers•What are some of the reasons why your customer won’t adopt your product?•What can you do to mitigate this risk?After approval of your Mission Statement. . .Research Market–Begin Research•Write scriptScript•Begin with Market hypotheses (3-6)–Examples?•Design questions to test these hypotheses•Keep short- you are using up people’s time!! 30 minutes tops. 10 minutes better•Can your customers use internet? http://www.surveymonkey.com/http://www.zoomerang.comMarket segmentation•Market “strategy”–There are 1.3B Chinese. Even if we got only 1% of the market. . .What’s wrong with this?The Technology Adoption Model as the Basis for Segment FocusA measure of the rate of adoption of a cluster of new technologies by a community over timeEarly MajorityInnovators Rate of AdoptionLaggardsLate MajorityEarly AdoptersTimeWhere are you on this curve?The New Idea Adoption Model in the developing world as the Basis for Segment FocusA measure of the rate of adoption of a cluster of new ideas by a community over timeEarly MajorityInnovators Rate of AdoptionLaggardsLate MajorityEarly AdoptersTimeWhere is your target