Part 3

• Analyse market opportunities (Do Your Homework!)

• Research and select target markets (More Homework)

• Develop marketing strategies (Yet More)• Plan marketing tactics (Don’t start here)• Organise, implement and control marketing

efforts

The Marketing Management Process

Customer Acqui-sition

Vision, Mission,

Objectives

Analyse Marketing Opportunities

Business Environment(PESTLIED Factors)

MarketEnvironment

Our Business

Suppliers

Customers

Competitors

Choices:Segmentation

Targeting

Positioning

4 (7?) P’s of Mark-eting

Unique Value Proposition

PESTLIED

• Political• Economic• Sociological• Technological

• Legislative• International• Environmental• Demographic

Why Did Lion Lager Fail?

• Share of market, and share of pocket• Share of customers’ minds – awareness and

visibility• Share of heart: which company do customers

prefer to buy from?• Convenience and availability – reach and

distribution• Service levels

Analysing the Competitive Environment - Influencers

• Customer awareness of products and services• Product quality• Technical assistance available• Selling staff – skills, morale, reward and

recognition, tactics• Price and pricing policies/tactics• Management quality and staff commitment

Analysing the Competitive Environment - Influencers

Strengths

Weaknesses

Our Company

Strengths WeaknessesCompetitors

Best

Worst Future?

Differen-tiate

Analysing the Competitive Environment

But you can’t do it without information!

Threat of mobility -

new entrants

Intensity ofthe rivalry

Threat ofsubstitutes

Customer Power

Supplier Power

Porter’s Model of Industry Attractiveness (5 Forces Determine Attractiveness)

Barriers and Profitability

Low, stablereturns

Low

High, stablereturnsHigh

Low

Low, riskyreturns

High, riskyreturns

High

Entry

Bar

riers

Exit barriers

Industry Competition• Number of Sellers - Degree of

Differentiation• Entry, Mobility, Exit barriers• Cost Structure• Degree of Vertical Integration• Degree of Globalisation

Activity: Porter’s Model – p50

Your Turn!

Would you class your industry, and your company’s position within it, as attractive or not

attractive?

Briefly analyse your company’s relative strengths and weaknesses using Porter’s Model of Industry

Attractiveness

Sales & Profit Life Cycles

Introduction Growth Maturity DeclineTime

Sale

s &

pro

fits

Pre-launch “and Introduction is Expensive. Why?

Pioneers & Early Adopters

Laggards & “Nevers

Re-launch? Or cannibalise?

Why do so many new products fail?• Poor market analysis• Product/service defects• Poor marketing• Bad timing• Competitive strength• Higher production costs• Product price too high• Over estimation of market size

450 – Launched Today

100 – Survive 1 Year

1 - Survives 5 Years

Four Introductory Marketing Strategies

Rapid-skimmingstrategy

Rapid-penetration

strategy

Slow-penetration

strategy

Slow-skimmingstrategy

Price

Low

High

PromotionHigh Low

Maturity Stage - Choices• Market Modification• Product Modification• Marketing-Mix Modification

Decline Stage - Choices• Increase investment• Resolve uncertainties - stable investment• Selective niches• Harvesting• Divesting

Please review the table on pages 54 and 55 that shows details of various aspects of

the Product Life Cycle

There is one dangerous trap to be avoided when using this PLC approach…

Beware of the danger of the self-fulfilling prophecy!

High Relative Market Share, andHigh Market Growth:

“Stars” - develop product / service, invest in R&D,

extend credit, keep competitors off balance, promote aggressively.

Low Relative Market Share and High Market Growth:

“Problem Child / Question Mark” - Usually new products.

Launch attack on a narrow front, co-ordinate all efforts,

keep it simple. (Guerrilla tactics called for here.)

High Market Share, and Low Market Growth:

“Cash Cow” - prune product range, segment and target more appropriately, reduce

costs, tighten credit, increase turnover.

Low Market Share and Low Market Growth:

“Dog” - lost cause. Don’t throw good money

after bad

Grow

th

High Relative Market Share Low

The BCG Matrix

20%-18%-16%-14%-12%-10%- 8%- 6%- 4%- 2%- 0M

arke

t Gro

wth

Rat

e

3 ?Question marks

? ??2

1

Cash cow

6

Dogs

87

10x 4x 2x 1.5x 1x

Relative Market Share.5x .4x .3x .2x .1x

Stars

5

4

The Boston Consulting Group’s Growth-Share Matrix

Grow

th

High Relative Market Share Low

BCG Matrix

Please read Roche, Michelin and Philips Case

Studies (p61 - 62)

Attractive Industry

Unattractive Industry

Company Strengths

Company Weaknesses

Invest

&

Grow

Harvest

/ Dive

stBe Sele

ctive

The G.E. GridWhat

makes an industry

attractive?

Porter’s Model of Choices

Focused Strategy

Low-Cost

Produ-cer

The Differ-entia-

tor

Prob

abilit

y of

Suc

cess

Analysing Customers and Buying Behaviour• Who are they?• What do they buy?• Why do they buy?• Who participates in the

buying process?• How do they buy?• When do they buy?• Where do they buy?

Customer InsightsA customer insight is a creative idea

which derives from a profound understanding of the customer

Implementing a high quality insight, translated into competitive superiority, will lead to a greater competitive advantage

Coke versus Pepsi:A lesson in perceptions and branding

Blind Test

Open Test

Prefer Pepsi

Prefer Coke

Same/Can’t say

52%

5%43%

22%66%12%

What influences customer purchases?

•Cultural factors•Social factors•Personal factors•Psychological factors

In business-to-business markets… • Demographic: What industries? What size companies? Which

locations?• Operating variables: What customer technologies should we focus on?

What is the user/non-user status? What are the customer capabilities?• Purchasing approaches: what is the purchasing function of the

company? (Centralised or non-centralised?) What is the power structure? What is the nature of our existing relationships? What are their general purchasing policies? How do they define the purchasing criteria? (Quality, service, price, speed?)

• Situational factors: How quickly do they want delivery? Are there specific applications for our products that are different? Order size?

• Personal Characteristics: Should we focus on companies which are similar to ours? What are their attitudes towards risk? What is their level of loyalty?

But What do Customers Actually Want? Identifying

Customer Insights*(*BTW – They don’t always know!)

The New Science of Customer EmotionsA better way to drive growth and profitability

Scott Magidis, Alan Zorfas, & Daniel Leeman (2015). The New Science of Customer Emotion. Harvard Business Review. Vol 93, No 11. 66-76.

I have a desire to: Brand Positioning SCARFModel

1 Stand out from the crowd Be seen as special/unique Clarity2 Have confidence in the future Positive image of the future Clarity3 Enjoy a sense of well-being Stress free. Balance.4 Feel a sense of freedom Act independently Autonomy5 Feel a sense of thrill Visceral, overwhelming pleasure 6 Feel a sense of belonging Aspirational. Feel part of a group. Relatedness

7 Protect the environment Environment is sacred8 Be the person I want to be Ongoing self-improvement. Status9 Feel secure Assurance. Pursue goals. Clarity10 Succeed in life Meaningful worth beyond money Status

10 of 300 “emotional motivators” that work significantly well across all categories

Protect the environment

35

The New Science of Customer Emotions

Standout from the crowdFeel secure

36

The New Science of Customer EmotionsA better way to drive growth and profitability

The Ultimate Marketing MachineMost Marketing Executives are stuck in the last century.

Here’s how the best meet the challenge of the digital age.

“Marketing has become too important to be left just to

the marketers in a company”De Swaan Arons, M., Van den Driest, F. and Weed, K. (2014). The Ultimate

Marketing Machine. HBR, Jul-Aug, 2014, p.55-63

The 4-Deadly Sins (i.e. Winning Characteristics)

1. Marketing Leadership: Marketing must tap every function. “Woe to the company whose marketing is still siloed.” Connect marketing to the business

• Inspire all levels by engaging them with the brand purpose/vision • Focus all levels on a few simple key priorities/rules (i.e. on time delivery)• Organise agile cross-functional teams • Build internal capabilities needed to deliver key priorities2. Insights from Big-Data: Research what customers are doing and why; this will exposed their needs. What are the “universal human truths” that drive them?3. Purposeful Positioning using All Three Brand Positioning Pillars: 1) Functional (caffeine), 2) Emotional (i.e. social), 3) Societal (i.e. fair trade coffee).

4. Total Experience: 1) Personalise the offering, 2) Adding more touchpoints. The most important marketing metric is “share of experience” not “share of voice”. Think numerous digital & physical touchpoints:

Customer Value Propositions in Business Markets, (HBR: March 2006, p.91-99)

Customer Value PropositionsPOSITIONING Disadvantage Advantage

1. List/mention all benefits: All Points-of-Parity (POP) and Points-of Difference (POD)

POD is diluted amoungst all the other POP/POD.

Shotgun all markets – but this is bad marketing-practice

2. All PODs (assuming there are many!)

Dilution occurs. Buyer may see your POD as his Points-of-Contention.

Differentiation

3. 1 or 2 x PODs (and maybe 1 x POP.Resonating focus

Not all markets will purchase, but this is good marketing-practice

Crystal clear differentiation. Mention what customers value most.

Note: Research to confirm. What are customer’s alternatives?

6 x Brand PillarsThe brain must be confused with myth and reality

Pillars of Branding Brand Positioning Ideas Your Brand

1 A simple symbol Nike swoosh, Tree (Timberland)

2 A chosen one Cowboy, Michelin man, colonel

3 A code of laws McDonald’s code of laws, recycle

4 A story & a secret Coke’s secret formulae, KFC’s spices

5 Common enemy Obesity, boredom, isolation, global warming, depression,

6 Rituals Mass, party, anthem, club

M Lindstrom’s book, Buyology (2010): nuns & brand addicts have the same cerebral imaging processes on fMRI scanners

Markitects

Georges, P.M., Bayle-Tourtoulou, A. & Badoc, M. (2014). Neuro Marketing in Action: How to talk and sell to

the brain. Kogan Page Limited. Great Britain and United States.

Hopefully, by now, you have “done your homework”,

and you have a good understanding of what

marketing opportunities exist.

What happens next?

Customer Acqui-sition

Vision, Mission,

Objectives

Analyse Marketing Opportunities

Business Environment(PESTLIED Factors)

MarketEnvironment

Our Business

Suppliers

Customers

Competitors

4 (7?) P’s of Mark-eting

Unique Value Proposition

Choices:

Segmentation

Targeting

Positioning

Once you understand your markets, but before taking action, you need to Make

Your Choices…• Segmentation• Targeting• Positioning

The S.T.P. Process

• Customer Segmentation, Targeting & Selection

Segmentation:Identify variables

that allow the market to be segmented

Targeting: Evaluate the attractiveness of each segment and

choose a target segment

Positioning: Identify and communicate

the unique and valued

differentiators

Who is out…

…And who is in?

•Segmentation•T•P

Why?• Who to aim expensive communications at

• What media• What image to create• Price range• Best distribution• Styling?

Why Niches? Guerillas vs. Gorillas• Distinct needs• Easier to find• Premium price• Few rivals• Certain economics

through specialisation• Niches have size, profit

and growth potential

Definition of a SegmentGroups of customers with similar needs or

wants and priorities...

and who because of this...

seek the same benefits and attach the same importance to their satisfaction

Sometimes this corresponds to the amount that they purchase from the company

SegmentationIt is obvious that if you haven’t deeply

and profoundly understood the customer’s needs*, your chances of

success are severely limited

* You need insights into customers’ needs, wants, desires, perceived benefits, expectations, fears, motivations and all other variables that will turn them on – or off – to your business and it’s offering

• Heavy to transport• Difficult to handle• Messy to store on shelves• Sold 2/3 to visitors, not Londoners

• A tool to understand customers• A cost-effective promotional vehicle• A symbol of commitment to customers

•Have identified 20 000 different market segments•Each customer has a unique “DNA Profile” derived from the products that they buy (“You are what you eat”)

•Sell information and intelligence back to manufacturers•Know that average diet lasts 18 days and can respond with encouragement and recommendations

Segmentation Activity – Part 11.Write down all the benefits sought by your customers on

Post-Its

2.Stick all those that are similar or cluster together, and give them a title

3.Divide all of these needs into 2 categories:

1.The hygiene factors – essential, deal-breakers

2.The motivators – desirables that contribute to the decision on who to buy from

Segmentation Activity – Part 2 (Simple)

1.Choose two motivators on which customers vary on their needs – the differentiating motivators

2.Make sure that they are independent of each other

3.Estimate the split of customers between high and low for each. (50/50? 60/40? 70/30?)

4.Cross multiply to create a perception map, and give each segment descriptive lables

Nando’s Example – Benefits• Tasty peri-peri (Sexy and

invigorating?)• Fun ads• Décor and ambience• Healthy for you (grilled

versus fried)• Happy chickens –

ethically sourced• Halaal and Kosher• Snob/status value

• Cleanliness and hygiene• Service/friendliness• Availability and access• Serviettes & hand-wash facility• Speed of service• Parking• Affordability• Quality meal• Not burnt

Nando’s Example – Taste and “Snob” Value• Taste: 80% high need for taste, 20% don’t care• Snob value: important to 60% of customers, not

important to 40%

Tast

e

Snob Value

NB

Not NBNot NB NB

48%

8%

32%

12%

HiT:HiS = 80X60 = 48%

HiT:LoS = 80X40 = 32%

LoT:HiS = 20X60 = 12%

LoT:LoS = 20X40 = 8%

Okay, so now you have a good understanding of your most important segments and channels

The next step is to target and select the “valuable” customers where your efforts will get the best return,

and match these with the amount of effort that you want to put into each segment by offering a superior

value proposition to each

Targeting: Evaluate the attractiveness of each segment and

choose a target segment

•Segmentation•Targeting•P

Why?• Size & growth?• Structural attractiveness? (Porter)

• Objectives, resources, core business, competences?

• Can we truly offer superior value?

But the superior value proposition must not only be

achieved and visible, but must also be communicated to and

valued by customers!

(See “Positioning”)

Who are the customers that we’d

kill to have?(Targeting and Selection)

What Makes a Customer “Valuable”?

What Makes Customers Valuable and/or Attractive?• Revenue, value, frequency &

distribution channels• Lifetime value & potential growth (Up-

sales, X-sales, price sensitivity)• Profitability of this customer, and

“expensiveness” (cost to serve) Also, hidden costs

• Ability to meet/exceed and differ-entiate needs. Delighted versus hostile versus mercenary customer

• Competitors and nature of rivalry• Our share of the customer, (portfolio

saturation,) & their share of us. Long tail may be profitable – or not

• Referrals & recommendations, and promoting our offer to their customers

• Risk: Creditworthiness, financial stability, assets, default likelihood

• Efficient ways of serving them & reduce cost to serve, physical accessibility, initial investment

• Willingness to share info, build relationships, learn & grow

• Our capabilities, competences, & assets

• Prestige, influence, & more

Our Competitive Strengths: Are we stronger or better than our rivals?• Market share • Brand awareness of products/services• Ease of doing business with you• Innovativeness• Price charged, and costs of doing business with you• Their service requirements and our ability to customise• Quality requirements and our capacity/quantity• Any investment that we are prepared to make• Added value for them in the supply chain, right up to the

disposal stage at the end• Long-term sustainability and risk profile• Our experience and/or willingness to learn

PositioningThe act of designing the company’s total offer and image

so that it occupies a distinct and valued place in the target customer’s mind

How will we position ourselves in this segment compared to other companies competing here?

Positioning Your OfferIf our company was…• An animal• A movie• A drink• A car• A property• A newspaper or magazine

…what would it be?

Use these to find out what your customers’ perception are right now, (e.g. postcard contest, or focus

group,) but also to determine what your desirable state will be

Positioning Your Offer – The Statement

• Convince… A segment

• That… Our product or service

• Because… Differential benefit

• Health conscious eagles

“Nandos is healthy because our chickens are not fed with hormones”

Positioning Your Offer – The Statement

To business managers and professionals engaged in making time sensitive decisions about

international business, DHL delivers on time because its pickup, transportation and delivery system is wholly-owned and managed by DHL

personnel, not by third party providers

Positioning…How will we position ourselves in this segment compared to other companies competing here?

…As opposed to “Differentiation”:“The act of designing a set of

meaningful differences to distinguish the company’s offer from those of its

competitors.”

The Customer Experience Model

Product: Must Work

Service

Experience

Delivery System

The Customer Experience Model

Value for money, reliability, variety,

safety, price, available

Emotional, partnership, relationships, social impact,

atmosphere Value for time, choice,

communication, individual

Knowledge/skills, access, attitude, caring

processes

Brand and image of company, but also skills/attitude/ personality of people

If you could pick one only?

Module 2Marketing Tactics and

Activities: The Four P’s

Agenda: Module 2•The Marketing Mix – the 4Ps of marketing (and another 3Ps)

•Products – features and benefits•Price – how to make decisions, pricing methods•The pitfalls of price-cutting – and alternatives•Place - and distribution channel decisions•Promotion – 5 specific methods, (advertising, sales promotions, public relations, personal selling, direct marketing)

Agenda: Module 2 (Ctd.)•The Challenger Sale•What promotional mix is best?•The AIDA Model•Strategies for growth – Ansoff’s Grid•Designing Global Marketing Offerings

Analyse market opportunities (Do Your Homework!)Research and select target markets (More Homework!)Develop marketing strategies (Yet More!)Plan marketing tacticsOrganise, implement and control marketing efforts

The Marketing Management Process

Customer Acqui-sition

Vision, Mission,

Objectives

Analyse Marketing Opportunities

Business Environment(PESTLIED Factors)

MarketEnvironment

Our Business

Suppliers

Customers

Competitors

4 (7?) P’s of Mark-eting

Unique Value Proposition

Choices:

Segmentation

Targeting

Positioning

The Four P’sProduct: must meet needs & wants

Price: what are they prepared to pay?

Place: convenient to customers

Promotion: communicate effectively with customers

The Marketing Mix: Now that the analytical “homework” has been done, and you have determined your marketing objectives you can plan strategies & tactics

People, Processes, Premises?

Maximising Value through Customer Management

Customer Value?

Cost to Customer?

Communica-tion? (RAP)

Con- venience?

Product Decisions•What combination of Goods, Services, Events, Places, Properties, Ideas, People, Information, Experiences, and Organisation does your offer include?

•How important are each of the four elements that make up the total customer experi- ence for your customers?

•Bear in mind that you cannot put whipped cream on garbage (The basics must be right)

Product Decisions•The product variety to be offered (Choice)•Levels of quality: reliability, durability, error-free, cut the frills versus the best that money can buy

•Design: style, form, performance, appearance, installation, unpack, use, etc.

•Features that are included•Brand names and symbols•Packaging and/or sizes to be offered

Product Decisions•Any other services to be included: maintenance, notifications and reminders, rewards, trade-ins and disposal, all the “freebies”

•Warranties available•Return and cancellation policies•Thus…

• Must benefit customers by meeting/exceeding needs, wants, desires, expectations

• Will affect everything else in marketing mix

Price Decisions•Too high versus too low•Four main factors that will influence price decisions:•Cost of producing product/service (Sets the minimum price, and works forwards – “cost +”)

•Competition and level of market demand•Value perceived by customers (Sets the maximum price)

•Level of profitability required to sustain and continue in business (Working backwards)

Price Decisions•Different prices for similar products in different segments by changing promotion, perceived image, or actual quality. (Airlines, motor vehicles)

•Differential pricing based on demand…• Includes lower prices off-peak (movies, hotels, travel)• Price skimming strategies at launch, growth, maturity, decline

stages (Vodacom, Panasonic)

•Competitors and pricing: especially if you know their strategy: market share versus profitability

Price Decisions: Questions to Ask•What is the list price? How does it compare to rivals?

•Discounts and commissions to be offered?•Any allowances?•Payment period and credit terms?

Price Decisions: Common Problems•Too cost oriented•Not revised often enough•Set independently of the rest of marketing mix rather than with the positioning strategy

•Not varied enough for different products, market segments, and purchase occasions

•Giving in to sales people who think only of short-term deals rather than long-term impact

Relative

Price

Low

High

HighPerceived Quality of Experience

The Marketing Battleground

Low-Cost Producer

Differentiator

Blue

Ocean

Rip Off

• Few Substitutes: Monopoly/cartel, proprietary technology, high cost of switching, “grudge purchase”, desperate need, dominant brand equity, powerful loyalty programme

• Status, prestige & power• Fashions or fads• Exclusive, unique, one-of-a-kind• Impulse buying purchase• Emotional purchase: +ve or -ve

Price Decisions: Six StepsStep 1 - Select Pricing Objective•Positioning•Maximise profit versus market share versus sales growth (PLC Stage)

•Survival in price s situation•Market skimming pricing•Product quality leadership•Other?

Price Decisions: Six Steps

Step 2 - Estimating Demand•Elasticity of demand, or price sensitivity•Affected by uniqueness, awareness of or access to substitutes, ease/difficulty of price comparisons, total expenditure to income, end benefit effect (ROI), shared cost effect, sunk costs effect, price quality effect, (prestige, exclusivity, image,) inventory effect, desperation

Price Decisions: Six Steps

Step 3 - Estimating CostsStep 4 – Analysing Competitor Costs, Prices, and Offers

Step 5 – Selecting a Pricing Method•Mark-up: Cost +•Target-return: to get ROI on large initial costs•Perceived value: charge what the market can take

•Value-pricing: best value for money in this segment•Going-rate: same, slightly more, slightly less•Sealed-bid: tenders

There are also 19 suggested strategies to use when customers feel that your price is too high

Place Decisions The Distribution Channels

3 Choices…•Sell and supply direct to final customer/consumer•Sell and supply through an

intermediary/middleman•A combination of the above

What are the relative pro’s and con’s?

Place Decisions

Choices will be determined by…•The nature of the product itself•The customers’ preferences•The levels of customer demand for the product

Place Decisions: What Questions •Directs versus through middleman? (The trend towards

“disintermediation”) •Who “owns” the customer?•What coverage will occur? In what density?•Assortments: who gets to sell what?•Who keeps what stock? What order lead times? •How will physical distribution take place?

Place Decisions: What Questions •Locations at which sales occur? (Branches,

shopping malls, internet, direct mail, network marketing, etc.)

•Third party/outsourced logistics?•Transport to final point of consumption? Who gets what? Who comes to us? Who do we go to?

•Convenience to customers is the key issue here

Promotion Decisions: How can we most effectively communicate with and present our offer to customers?

You have to identify…•Your target audience•The response that you want•And avoid “spray and pray!”

He who has a thing to sell,And goes and whispers in a well, Is not so apt to get the dollars,

As he who climbs a tree and hollers!

THE PROMOTION MIX1. Advertising (Paid for, non-personal)2. Sales promotions: to consumers, “the trade”, or the

sales force, (including exhibitions and sponsorships)3. Public relations/social responsibility (Personal, non-

paid for)4. Personal selling, (& network marketing)5. Direct marketing, www (& network marketing)

Advertising• Market leaders derive more benefit than others• Market leaders get better returns than from other promotional

activities• Less effective in markets with fewer/ large buyers• Good for introducing new products, explaining new features, or

even for training customers• More economical than sales calls as a reminder• Can be used to generate “hot” leads

Sales PromotionShort-term incentives to encourage trial, purchase or

repurchase

• Consumer promotions (Hundreds!)• Trade promotions• Sales force promotions

Public Relations and PublicityDesigned to promote or protect the company’s image

or products• With the various publics, but especially customers• Far less expensive that advertising, but…• Far more credible and believable: more authentic,

and catches them off-guard• Personal and trusted

Getting Publicity• Is it newsworthy, interesting and dramatic?• Is it authentic and subtle, or blatantly in your face?• Does it spotlight an event or product, or piggyback

on something that happened/is about to happen?• Was it properly planned? Did they really want it?

Personal SellingFace-to-face conversations to make a presentation, to answer

questions, to close a sale and to build relationships

• Most expensive, but most effective• Full time or part time or even outsourced• Telephonic contact improves efficiency• Alive, immediate and interactive• Can get immediate response

Direct and Interactive MarketingUse of mail, telephone, fax, e-mail, internet and other media to

communicate directly with customers. Also includes “pyramids

• Can be personally addressed to a specific person, and customised, and response measured

• Is interactive to a degree• Responders can be targeted again• Easy to disseminate quickly

•Type of product market•Buyer “readiness” stage•PLC stage•Communications objectives

What is the best “mix”?

The goal of all promotion?A: Grab attention/awarenessI: Create interest through benefitsD: Desire to purchase, likingA: Get action and get them to buy

The goal of all promotion?

And was it…R: Relevant?A: Anticipated?P: Personal?

Case Study: Cadbury’s• Only 3 of the top 10 brands in SA• One of their best sellers? Lunch

Bar• Research showed a number of

segments:• Treat – Eat Now• Treat – Eat Later• Refuel – Snack• Refuel - Gutfill

• “Gifting”• Functional

The Value Drivers for Refuel:• Snack: In-between meals, fills the gap,

personal, trust the brand, available anywhere, easy to share, less messy, right texture, light on chocolate delivery (guilt free)

• Gutfill: Hunger satisfaction, meal replacement, personal consumption, fun to eat, trust the brand, energy booster, great mouth-feel, cheers me up. (In SA, this is ……..?)

Who are the primary consumers of Lunch Bar?

Male or Female?Adults or Kids?Black or White?

The largest segment is black males, followed by white males

1992 in South Africa• Emergence of “black” as

beautiful, empowered, positive, independent, enfranchised

But how do you promote Lunch Bar to them without alienating your

second largest segment? We saw the birth of..

Makhatini from Maritzborough

• Increase prices (with or without adding extra value)

• Manage customers better by retention, cross- and up-sales, reduce cost to serve, regain “lost” customers

• Determine new strategies: Use Ansoff’s Grid

Strategies for GrowthNot many options to increase

business…

ExistingMarkets

New Markets

Existing Products

New Products

Protect and build: Market penetration, withdrawal,

or productivity improvement, cross-

sales, up-sales

Product development or replacement: listen and

innovate

Market development or refinement: need good marketing expertise and

good customer knowledge

Diversify or divest: risky

Ansoff’s Grid

So where do your

opportunities lie?

Questions to ask… and answer!1. How can we spot and choose the right market segment(s)

to serve?

2. How can we differentiate our offerings from competitive offerings?

3. How should we respond to customers who press us for a lower price?

4. How can we compete against lower-cost, lower-price competitors both here and abroad?

5. How far can we go in customising our offering for each customer?

6. What are the major ways in which we can grow our business?

7. How can we build stronger brands?

8. How can we reduce the cost of customer acquisition?

9. How can we keep our customers loyal for a longer time?

10. How can we tell which customers are more important?

Questions to ask… and answer!

11.How can we measure the payback from advertising, sales promotion, and public relations?

12.How can we improve sales force productivity?

13.How can we establish multiple channels and yet manage channel conflict?

14.How can we get the other company departments to be more customer oriented?

Questions to ask… and answer!