How demographics and gee-demographics are used in segmenting consumer groups. Demographic Allows marketers to group people with similar age, family composition and life cycle Gee-graphic Combination for people with similar demographics residing in similar geographical area Demographics Primary school Snack food, tooth paste, influence parent shopping habits Teens Power over personal and family purchases Like to be considered cool Young adults Overlap with baby boomers, generation x Baby boomer generation General target market for pad, import vehicles Computers Basic needs People getting by on a day to day basis A fairer deal
Think they get raw deal out of life Sees escape on TV, cars, tattoos Real conservatism Cautious Prefer to be safe, pay more for establish brands Asset rich, cash poor Visible achievement Success stories Family is important Practical Do not flaunt success Interest in public affairs Something better People wanting something more Competitive ambitious Want more then what they have got young optimism seek to gain a respected place in society disorganized wants to try everything dreaming of new York The Roy Morgan Values Segments and its usefulness Segmentation Group people into groups with similar needs, wants and consumption behavior
Allows delivery of messages to be more effective Four actions Separate consumers into similar product related categories Identify consumers with similar needs and wants e. G consumers that use mobiles and internet and middle aged people that want to keep in touch with family Group them according to demographics, values and lifestyles, to understand them From those groups take the largest to support customized marketing communication strategies The concept of positioning and the various bases that can be used to develop a Brand positioning Brand is the target markets perception of the product
Its what the consumer has learnt about the brand Product related features Innovative product design Superior materials If a brand has a product advantage then highlight it User and user imagery Brands can be positioned in terms of unique symbolism Brands can be positioned in terms of people who use them People who are portraying them in the advertisement Shampoo, use attractive women with perfect hair Positioning via brand benefits Appealing to the function, symbolic and experiential needs Products have benefits that satisfy those needs Functional needs Provide solutions Solving Consumption related problems
Symbolic needs Directed at consumers desire for self enhancement Affiliation and belongingness Cars with symbolic needs Experiential needs The desires for self enhancement, that provide sensory pleasure High in value Provides benefits for all 3 needs week 3 How price and advertising elasticity influence investment in advertising Advertising is treated as an expense, total profit for the year can be increased through decreased advertising expenses however fewer units may be sold decreasing value Advertising a brand depends largely on expectations about how advertising will influence a brands sales volume
Brand is performing above expectations Economic downturn Increased profits Decreasing advertising will increase short term profit, however in the long run you may lose customers and potentially not regain more at a faster rate leading to a reduced profit Increases brand equity Elasticity of demand How responsive the quantity of demanded is to changes in marketing variables such as price and advertising PEP = percent change in quantity/ percent change in price EAI percent change in quantity/ percent change in advertising Inverse demand lowering price will increase demand and quantity demanded will increase with the decrease in price
The functions of advertising and how to set achievable advertising objectives. Brand equity Marketing communications can increase brand equity Advertising enhancing brand awareness and developing favorable strong and perhaps unique associations in the consumers mind between the brand and its attributes When done right it can be isolated from price competition and differentiated from other competitors Advertising functions Informing Educates about the brands features Creates positive brand image Persuading Customers to try the products Reminding Keep the most consumers minds When a need arises they may see an ad Adding value
Production innovation Improving quality Changing perceptions To achieve Communicate to price reductions to attract customers Provides sales people with an introduction The hierarchy-of-effects model and how it influences setting advertising objectives. The hierarchy of effects model starts with the awareness of the brand, knowledge of the brand, liking of the brand, preference of the brand, conviction of the brand and then the purchase of the brand The objectives have to move the individual through the effects model Objectives that advertisers use to attempt to achieve Clearly positioned Directed activities to a specific market
To achieve specific objectives To achieve objectives within the allocated budget Objectives should be established prior to making decisions before message and media selections Objectives are an expression of the consensus of the mastering management Guides budgeting, message and media aspects of brands advertising Setting objectives Must be in accordance with the circumstances which characterize the advertisers brand and competitive situation, requires the understanding of goals Making consumers aware of a brand Influencing their expectations Encouraging them Achievable, be specific Precise, who what and when
Quantitative and measurable, results to be measured Amount of change, how much they actually did and whether it is acceptable or not Realistic Objectives must be internally consistent, with the marketing mix, so none contradicting objectives Must be clear in writing Brand loyalty Consistently buying the same brand of product Normally consistently changing their preference from one brand to another seeking variety It requires A brand that satisfies a consumers needs and Continuously advertising the brands benefits to reinforce the consumers brand and less price sensitive Should aim to generate loyal customers even too only a reaction of the target market will ever become brand locals The relationship between a brand’s share of market (SOME) and its share of voice (SOB). Consideration of competitor’s expenditure on ads, advertising must be put in place to maintain market position Calculating the ad spend of each competitor as a percentage of the industry expenditure produces what is known as share of voice, sob and some, this relationship is correlated as who ever has the most voice has the largest market share Also a two way as they are relational to each other If large some slow down their sob they may lose market share
However also high market share brands that increase their sob to increase market share could find themselves battling with others wanting to increase market share creating a competitive challenge Option A, your some is low and your competitors sob is high, the recommendation is to decrease ad expenditure and find a niche Option b some is high, mad competitor has a high sob, increase advertising to defend its present market Option c, some is low and your competitors is low, counter the competitor whoso sob is low with a large sob Option d, your high some, and competitor has low sob, maintain spending and match The nature and importance of advertising budgeting and the practical considerations that guide advertising budgeting. Advertising decision makers must consider three factors The ad objective Competitive advertising Funds available for advertising Percentage of budgeting sales The predicted or year before sales, a percentage is taken from their and put towards The comparative parity method Spend the same amount of advertising budgets as your competitor The objective task method Establish marketing objectives Asses communication objectives Determine advertising role Establish the specific advertising goals
Budget based on estimates The affordability method Funds that remain after budgeting for everything else are spent on advertising The legal and regulatory issues associated with advertising management The competition and consumer act 2010 Price fixing Misuse of market power Resale price maintenance Anti competitive behavior Misleading and deceptive conduct Goods should correspond with the description of the good itself Merchantable quality Examines the product in terms of defects Trademarks Protect, symbols, logos, names, shapes and goodwill of the company Copyright Packaging and labeling Labeling of cigarettes, must not seem like competitors Wee k 4 The role of advertising agencies and the relationship between agency and client.
Advertising agency organization Creative services- copywriters, graphic artist, creative directors media services- selecting appropriate advertising to reach customer research services, examine their clients customers habits different specialists paid on commission and a fee for service unique selling proposition strategy advertiser makes a claim based on the superior of a product attribute that is unique and resents a meaningful distinctive consumer benefit identifying the important preference which makes your product unique Brand image strategy based on promoting physical and functional differences between the adversities brand and its competitors offerings, the brand image strategy involves a psychosocial. Rather than a physical difference.
To develop an image or identify for the brand by associating it with symbols Resonance strategy The physical action of noise echoing cog an object, the ad resonates the audiences life Does not focus on product claims or brand images, but rather on circumstances or situations in the real imagined experiences of the target audience Show ease to an tuition a benefit they can provide Emotional strategy Is the third form of symbolic oriented advertising Advertising towards emotions Generic strategy The advertiser makes no attempt to differentiate from the brand competitive offerings or to claim superiority A brand that dominates a product category Pre emotive strategy- category dominance When advertisers make a generic claim Used where there are few functional differences between products Corporate image and issue advertising Pursued to ultimately purchase this brand over another Continued spending on corporate advertising for brand equity.