Group HR

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GEMS – Marketing module

Session 4Faculty: Dr. Richa Vyas

Group HRLearning from Assignment-1

• Can you relate Customer Value, Customer Dissatisfaction and Complaint Management?

• Did the exercise make you understand the value of Marketing and customer services in the consumer’s life?

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Group HRLearning So far….

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Group HRAgenda for Session-4

• Differentiation• Product Life Cycle• Strategies to Manage PLC

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Group HRDifferentiation

Positioning•PODs- Point of difference are the benefits that are unique to a brand-Dove (3/4 moisturizer), Skoda (Performance)•POPs-Points of Parity, associations that can be shared with some other brands e.g Luxury Car-Stylish / SUV-Rugged

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Group HRDifferentiation- Example

Wal-Mart: Sam Walton took department stores to the hinterlands instead of the cities and made a fortune.

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Group HRDifferentiation

• Hardee’s: When other fast food chains were getting “healthy,” Hardee’s reinvented itself with the Thickburgers. (Unapologetically, the Monster Thickburger contains 1,420 calories!)

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Group HRSteps in Branding

• Define the customer segment• Interpret the attitude, aspiration, thoughts…• Decide a suitable value proposition• Create the communication strategy• Implement and rollout

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Deciding the target sharply

• Who to target?• Write down the characteristics of your target

segment; For Hardee’s it will be Foodies, least careful about calories, enjoys food and have a happy go lucky kind of attitude

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More on Differentiation

• BOSCH• Industrial product• 5 day promise – all

warranty repairs in 5 days• Stressing on high capability

of the technology

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Product

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Levels of Products

Product Levels• Core benefit (e.g. hotel

offering rest and sleep)• Basic product (any room with

a bed)• Expected product (room with

attached bath, TV, phone etc.)• Augmented product

(conference facilities, Wifi )• Potential product (customized)

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Product Differentiation

• The form – size, shape, structure (various kinds of soaps)

• Performance quality – level of performance (e.g. Du Pont materials perform better)

• Conformance quality – meeting promised specifications (e.g. CNC machines conforming to Indian shopfloor conditions)

• Durability, reliability (Scoda)• Repairability (Maruti suzuki)• Style

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Product Decisions

• Product Line – number of lines, • Product mix – variants (e.g. Tata Motors –

Passenger Cars – Nano, Indica, Indigo, Sumo, Safari, JLR)

• Line stretching (upward and downward stretch; Nano – JLR)

• Line filling (Indigo CS, Indica Xeta, Sumo Grande)

• Packaging – based on consumer behaviour, brand image etc.

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New Product Development

• Steps:• Idea generation (worthiness of the idea – e-choupal,

Walkman/iPod, Post it)• Idea screening (is the idea compatible with company

objectives/goals/values etc.? Gucci- • Concept development and testing (building a concept that

customers would like to try – feedback from customer segments: Vaseline Body Lotion- Summer-Aloe Vera, Winter-Peach)

• Marketing strategy development – how will this product fight it out in the market?

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New Product Development

• Business analysis – will the product meet profit goals?

• Product development – creating a product that meets the requirements (Standards/Norms/ meeting customer needs – Post It Notes)

• Market testing – are sales as per plans? (New Coke / iPod)

• Commercialization – rollout /launch

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Product Development - Example

Cummins• Modularization – understand each customer’s

operating economics• Adapting product to suit unique customer requirements

– A Big Industrial Client• Focus on growing segments – farmers, healthcare• De-constructing the offering – expected product +

value adds• Roping in distributors to act as partners (welcoming the

sales of add-ons)• Focus on new opportunities – Residential complexes

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Stages of Product Life Cycle

• Introduction• Growth• Maturity• Decline

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PLC – Introduction stage

Tasks for Marketers:• New to the world product ( Kellogg’s – selling the concept –

educating customers• Inducing trials – free packs, trial sessions, affordable

sachets (low risk trials)• Skimming – penetrating the market (rapid

penetration/skimming or slow penetration) – building a ‘must have’ image (Sony Handycam)

• Handholding customers – multi channels for problem solving and information dissemination (LG Microwave ovens – free cookery lessons)

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PLC – Growth stage

Tasks for Marketers:• Innovations to grow acceptance levels – features sought by

mass market (mobile services at cheaper plans)• Mass promotions – differentiation that appeals to a large

customer segment (Fair & Lovely)• Role of channels – mass distribution – enough penetration

– new channels for greater penetration (Hindustan Unilever Shakti Amma)

• Increasing off-takes by focusing on sub-segments – launching several variants (Tata Indica)

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PLC – Maturity Stage

Tasks for Marketers:• Price wars – innovate for beating commoditization (Gillette

Sensor)• Focusing on a different segment to boost sales (Cadbury )• Value additions – giving customers more reasons to buy

(Mobile + PDA + TV)• Niche segments – targeting fence sitters (Colgate Gel /

Total etc.)

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PLC – Decline stage

DECLINE STAGE:• Rejuvenation – create a new differentiation (Soaps-

Dispensers)• Strategic tie-ups – redefining the role of the product

(Many Home appliances companies – contract manufacturing)

• Change the segment • Divest (if category is also in decline stage -

typewriters)

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Home Work

No Homework this time

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Any questions?