Inseec - Strategic Marketing - Rodolfo Cremer

International Academic Seminars
January, 2014

Rodo fo C
Rodolf J. Cr
Rodolfo J Crem MBA Ph D ( )
Cremer, MBA, Ph.D. (c)
rcremer@marketingdeservicios.com

© Dr. (c) Rodolfo J. Cremer – MdS Marketing de Servicios

Rodolfo J. Cremer, MBA, Ph.D. (c)
Academic Vice President
San Ignacio de Loyola University
© Dr. (c) Rodolfo J. Cremer - Escuela de Postgrado Universidad San Ignacio de Loyola

The way we will interact (in this course)

“When teaching ,
teach also to doubt
what you teach”
Ortega y Gasset


¿who are you?
¿where do you come from?
¿what do you expect to happen?
(in this 6 hours)

¿who am I?
¿what am I doing here?
(what do I expect to happen)

Ph.D. (c) Rodolfo J. Cremer, MBA
Vice President at Universidad San Ignacio de Loyola, Lima, Perú
Director at Marketing de Servicios for Perú, MdS
Director at MERCO for Peru
Professor Cremer is the Academic Vice President at Universidad San Ignacio de Loyola, responsible of the operation
of the graduate, undergraduate & working adult programs. Until December 2012 he was Dean at the Universidad
San Ignacio de Loyola Graduate School of Business. He is also Director at MdS (Marketing de Servicios, Peru), and
member of the Advisory Committee at Merco Perú.
He was Vice President at Universidad Peruana de Ciencias Aplicadas – UPC, member of Laureate International
Universities), and his professional experience and academic background during the past 20 years have taken him to
lead projects, directories and general management at different industries and market segments.

He has wide experience in commercial and marketing strategies, designing strategic planning and constructing
balanced scorecards, defining KPIs, designing service and loyalty programs, and the tactic execution of the strategy
in the operational business.
Professor Cremer teaches Strategic Marketing and Service Marketing, and has been lecturer in subjects as strategic
planning and balanced scorecard, loyalty programs and service marketing strategies in many prestigious
universities, MBA programs and postgraduate schools, as well as in open seminars and consulting projects. He was
also lecturer in the international event BALAS 2006 (Business Association of Latin American Studies) and in the XI
Seminary and I International Congress of Marketing and Publicity in Bucaramanga, Colombia (2007), and visiting
professor at DeSales University, Pennsylvania, US (2009).
His professional experience background is in multinational companies, where he has held the positions of director,
marketing manager and commercial manager. His professional experience is in strategic planning and commercial
and marketing plans, developing loyalty programs (CRM). He has worked for companies such as Pepsico, Price
Waterhouse Coopers, Yamaha Motor of Peru, Kawasaki, Suzuki of Peru, General Motors, Mibanco, Los Delfines
Hotel & Casino, Banco Financiero, Atlantic City Casino. He has developed programs of consultancy and participated
in in-company seminaries for Interbank, Nissan, LAN, Asosiación Peruano-Britpanico, Constructora Líder, Besco,
Impulse Telecom, Belcorp, Telefónica, Postobón (Colombia), among others.
Mr. Cremer is a Ph.D. candidate in International Business Administration at Universidad Politécnica de Cataluña,
Spain. He is also MBA by the UQÀM (Université du Quebec à Montreal), Canada, and MBA by the Universidad San
Ignacio de Loyola (Lima, Peru). In both cases he graduated first place in his class.

Education

Student

Teacher / Lecturer

Undergraduate
•

Business
Administration

Graduate
•

MBA

Doctoral
•

International
Administratrion


Work Experience

Full Time

Consultancy

Services
•
•
•
•
•
•
•
•

Education
Banking
Microfinance
Gaming
Beauty
Consultancy
Security
Health

Automobile /
Motorcycles /
Industry

Consumer
Goods
Construction /
Real State


Getting to know your
expectations

¿what do you expect from a quality

STRATEGIC
MARKETING?
“course” of

www.marketingdeservicios.com

Expectations from the STRATEGIC MARKETING course

Course: Strategic Marketing
INSEEC, Paris. 2014-01-20

13

OK. Let’s start …

IMPORTANT / “DISCLAIMER”:
This PPT is only supporting material for class discussion.
Not everything that we discuss in class is in the PPT,
either everything that is in the PPT will not necessary be
discussed in class …
However, I am available at rcremer@marketingdeservicios.com or
rcremer@usil.edu.pe for any further information .

Neils Böhr said:

“The opposite of a fact is a
falsehood;
but the opposite of a
profound truth may well be
another profound truth.


15

Confucius said:

“Study without thinking
is a waste of time;
thinking without study
is dangerous”.
The Art of Strategy, Thomas Cleary

(the same: from my personal experience working with people who know
nothing about marketing -and they are taking marketing decisions-)


16

In this seminar :

We are going to do something
executives rarely do
(and I include myself of course).

2012 © - Dr. (c) Rodolfo J. Cremer – MdS Marketing de Servicioseservicios.com

17

We are going to

think
(to think strategically)

18

We have no time to plan the
future; we are too busy
solving today’s problems.
Anonymous

(and -on the waywe are measuring anything)
My own experience – Rodolfo Cremer

“I am interested
in the future
because is where I am
going to spend
the rest of my life”.
Woody Allen


2 favours:


21

1. During learning
periods the mind acts as
a parachute

22

It’s better

when it is

open

23

The opposite to …


24

The closes to …


25

2.
NO Paradigms /
NO Prejudices.

26

agenda (objectives) for today
1. Foundations and Process of
Strategic Marketing :
what is (& what is not) Marketing
(a perspective from the XXI century).

2. Transactional Marketing vs
Relationship Marketing.


Fuente:
http://trescosashermosas.blogspot.com/2011/02/y-pensaba-que-telefonica-era.html


Sales are the result of
relations
[ not the other way around]. 1

Fuente:
1 ALCAIDE CASADO, Juan Carlos; SORIANO SORIANO, Claudio L. Marketing Bancario Relacional.
McGraw-Hill / Interamericana de España, S.A. [2005]


Requires a change of Paradigm

from the

Transaction
to the

Relation

!

The

BIG
picture

Market Research

Environment: external factors.
Competitors, laws, social , politic, economic,
technologic, demographic, geographic &
trends and factors as values and lifestyle etc…

Total Market / Population
Understand the
insight and the
consumer buying
behaviour: habits,
like, preferences,
fears, etc

Segment //
Targeting

Differentiate

We align the
Marketing Mix

1.Product
2.Price
3.Place
4.Promotion
5.People
6.Processes
7.Physical
evidence
(Perceptions)
8.Provision Moment of
Truth

Position
(Positioning)
Fuente y Elaboración: Rodolfo J. Cremer, Ph.D. (c)

Marketing Plan
1.

2.

3.

Actions: What,
Who, When,
How, Where,
Why…
How much:
forecast, Budgets
and objectives.
Indicators and
Ratios.

then …

“¿What is

marketing?”

Marketing
Is
About
War

Shaman from Piura

TIE UP
YOUR
IMPOSSIBLE LOVE


35

PLUMBER, in Trujillo, Perú.


36

FUMIGATION MAN, in
Lima, Perú.

2014.01.16

37

Other proposals are more sophisticated and exciting

92% of our
Customers are satisfy
with our service.


42

Which company is more commitmted?

We arrive in 15
minutes or we pay
you $100


43

During a road trip on a lonely road, I stopped in a
town to buy something to eat.
When entering the pizza restaurant I saw a sign that
said:

“Quality, Service, Good Price.
Choose two.”
Selecciones del Reader’s Digest
Pp 101, agosto 2007


¿What’s happened?
[where’s the marketing?]

¿What is “Marketing”?

Marketing

To offer the customers

Products and services
to reach the satisfaction of their
needs, wishes and expectations.
J
Jerome McCarthy / Phili K tl
M C th Philip Kotler
t
l


The paradox of

satisfaction

Let’s look at the example
of the automotive
industry


In the automotive industry…

Only 15% renews with the same brand
Completely
mpletel
satisfied

Very satisfied

10%

Satisfied

Very disatisfied

80%

completely
disatisfied

10%

80% + 10% = 90% Dropout Rate = 75%
Satisfaction does NOT guarantee loyalty

A LADA salesmas says:

“A LADA
is forever …”
What he didn’t say was:

“… becasue
nobody would
buy it later”.

Survey of more than 2.000 general directors, commercial directors and Marketing directors
of the most relevant national and international companies of different sectors.

ƒ 1 out of 4 Spanish companies (25.4%) expects
to lose between 10% and 30% of their
customers.
ƒ
ƒ

ƒ
ƒ

19,9% of the companies believes they’ ll lose between 10% and 20%.
While 5,5% forsees that the droput rate will be between 20% and 30%.

7% of the surveyed companies admits that the churn rate can
rapidly grow more than an alarming 30%.
Numerous companies choose to accept droput rates in a
natural way, intensifying their efforts to attract new clients.


Survey of more than 2.000 general directors, commercial directors and Marketing directors
of the most relevant national and international companies of different sectors.

ƒ Asked about the reason for the dropout, 73% of the
customers mentioned “customer service” as
the main one, compared to 21% of the managers.

ƒ 50% of the managers attributed the dropouts to the price,
24% of the “deserter” customers mentioned
the prices as the reason.
while only a

ƒ This difference speaks for itself about the learning &
understanding necessary.


and ¿HOW

is the
QUALITY of a
SERVICE
measured?

“If we paid services in the street
the same attention we give to the
products in the factory,
certainly a large number of new
opportunities will appear”.
Theodore Levitt-

©Fuente: IMdS. Cremer – MdS Marketing de Servicios
Dr. (c) Rodolfo J. www.marketingdeservicios.com

THE QUALITY EQUATION

(in services)

(1) Expectations


E

I came for this
promise

Pero recuerda
y se queda con
esta realidad
(y se lo cuenta
al resto!!)


E

I came for this
promise

And I found
this reality
(this is what
he tells the
rest!!)

P

The Quality Service Equation

C=P–E


C=P–E
¿How much should C be (obligation)?



C=P–E
0
¿How do we ensure a C+?



C=P–E
0
+
¿How do we ensure a C+?


I have a question for you


Can we apply a high quality
service strategy & operation
model in any business?

ƒ What about a supermarket?
ƒ

(It's a “commodity store”?)
Or an “low fare” airline?

In other words …

Quality,
Service &
Good Price.
Can we have
all three together?

Let see how (or if it) it works.

C=P–E

“When the company have no clear and
specific quality standards, the daily and
everyday decision of what should the final
quality that the products and services of
the organization be is left to the
employees”
Article: Los Estándares de Calidad en el Servicio, del MdS



“¡¡Best wishes and good
faith DOES NOT
ensure that the
CRITERIA of the
employees meet the
EXPECTATIONS of the
CUSTOMERS!!”
©Fuente: IMdS. Cremer – MdS Marketing deicios.com
v Servicios

The first step:

PART-TIME MAID NEEDED
DOESN’T NEED TO KNOW ANYTHING
JUST OBBEY


“Satisfying the customers is no
longer enough,
we have to delight them
and even amaze them.”
Article: La medición de la satisfacción del cliente
(Juan Carlos Alcaide, director del MdS)


“It’s not the products but the

processes that create the
products,
what adds up to the long term
success of the companies”.
Michael Hammer & James Champy
Reengineering the Corporation: A Manifesto for Business Revolution

© Fuente: MdS. www.marketingdeservicios.com
Dr. (c) Rodolfo J. Cremer – MdS Marketing de Servicios

In many cases the “obsession”
for customers’ satisfaction can become
the only safe way to guarantee the short
and long term survival of the company .
Article: La Medición de la Satisfacción del Cliente de MdS


•
•
•
•

Our values:
The customer is our reason for being
Our people is most important
Innovation
Superior performance


WORD OF MOUTH: THE CONSUMER

AS A MARKETING TOOL

© Dr. (c) Rodolfo J. Cremer - Escuela de Postgrado Universidad San Ignacio de Loyola

Let’s talk about the “

E

”

¿How are (customers’)
expectations formed?

Definition (according to RAE)

Expectation: the Hope to do or get soemthing.
Reasonable posibility of soemthing to happenPossibility to get a right, an inheritance, a job or
any other thing provided that a planned event
happens.

79

Fuente: RAE. www.rae.es

Marketing Communication of the
company
Sales Process Management
Other communications from the
company
“Athmosphere” created at the
meeting point of the service
Personal Experience with the
company
“Mout to Mouth” communication
Personal Experience with other
companies

Expectation

What to do

Marketing
Communication

Don’t make primises you can’t not keep.
You can Underpromise (and give more)

Sales Process
Management

Do Not “over-sell ” the virtues of your services; sooner
or later you will have to deliver the moon.

Other
communications

Control the implicit messages they contain

“Athmosphere” created Use the tangible elements and the environment of the
at the meeting point of meeting to show what the customers should expect.
the service

Personal Experience
with the company

Don’t allow “valleys and peaks” in the services of the
company: clients always expect a steady quality of service

“Mout to Mouth”
communication

Keep your customers satisfied so that they “speak
well of you”

Personal Experience
Constantly check what the competition does [and how
with other companies it does it]; use benchmarking

They 10 key Expectations

[Berry, Parasuraman & Zeithaml]

82

Fuente: MdS. www.marketingdeservicios.com

¿What has
happened?
In XXI Century

Transactional Marketing

Product
Price
Place
Promotion
ƒ Management culture dominated by the
supply side.


marketing was born in this era
for this products
competitors
& customers


It does NOT
Work in XXI
century!


And there was another option left for us…
The services
had no choice but to

adopt (product) marketing
Just as it had

been thought for the

products
(in despite of the obvious differences
between products and services)

Differences between Products and Services

Î The intangibility [of the service]

Î Simultaneity production –
consumption
Î Production process
Î Contact company-customer

Î Heterogeneity of services, and
Î Customer engagement [in the production
process]

I Birth

Pure adoption
4Ps

II Evolution

A cry (shout) of freedom
1977: “Breaking Free From Product Marketing”
(Liberémonos del marketing de productos)
G. Lynn Shostack, Vicepresidenta del CitiBank

III Adaptation

Aplicability
Relationship
Marketing

Traditional
Marketing

Internal
Marketing

therefore…
a three-dimensional
approach is needed


New Three-dimensional Perspective

Relationship
Marketing
Delivers what was promised
and manages the relationship

Traditional
Tradicional

Internal
Marketing

Comunication of
promise

Allows the delivery of
what was promised
(accomplish)


91

New Three-dimensional Perspective

Relationship
Empowerment
Provision –
Marketing
Emotional
People
connection:
People

Abilitues, emotions,
attitudes, service
vocation “depart
“moment, of true”
from the script”,
extra mile ,,,

Experiences
Delivers what was promised
and manages the relationship

Customer
Traditiona
lMarketing
Product
Price
Place
Promotion

4Ps

Communication of
promise
i

“moments of thruth”

Internal
Processes
Processes
Physical
Marketing
Evidence
Standards
Homogeneity
at the point of
sale:
Tasks, tools,
formation, scripts,
moments of truth…

Allows the delivery of
CRM
what was promised
(accomplish)


92

New Adapted Approach in XXI century (expanded marketing)
Product – Service
Price

People

Place

Process

Promo

Provision

Phsycal Elements
(evidence)

Benefitdelivery


What is an organization chart like?

organization

customer

Process
(need cross-functional organization)


This is the way in
which a traditional
organization chart
works today

Contribution from
Prosper Bernard, Ph.D.
(mi professor at UQÀM

Graduate School)

… and these are the results…

It’s not enough to do things right,
we have to do “right” the “right” things.


ƒ

Comunication – direct marketing:

increases its importance in

saturation and lack of massive means

ƒ

Distribution: strategic partnership between the channel and the
manufacturer, procedures and shared databases

ƒ

Service Marketing: increases customer satisfaction, frequency and
quality of contact and its impact on loyalty.

ƒ

Marketing of industrial and high technology products:
development of “one to one”, joint ventures, joint development and common
perspective of the value chain

ƒ

Quality: TQC, TQM, importance of the quality of satisfaction.

ƒ

Flexible Production – JIT: cost reduction of changes enables the
client-oriented strategy. Orientation to maximun flexibility in scale economy

ƒ

Enterprise Strategy: “keiretsu” clusters with interrelated interests
and long-term commercial links


[then]

¿what is marketing?

Marketing
According to G. Lynn Shostack

Marketing is the area (and the
1 in charge of
processes)
keeping the link between
the company and its customers
link = relation
¿elements of a relation?
1. Contribution from Mr. Victor Requena. UQAM XVI.

link = relation
¿elements of a relation?
Satisfaction
Trust
Respect
Comunication
A relation: Win – Win

Loyalty
Fidelity (trust)

They are not the same

Passion

Love + Convenience
Forgiveness
Kowledge

¿Why is customer service important?
Î More loyalty from consumers, customers and users.

ÎIncrease in sales and profitability(the high quality allows, among
other things, to la alta calidad permite, entre otras cosas, set higher prices than
the competition).

ÎMore frequent sales, more repetition of business with the same clients,
users or consumers.

Î A much higher level of indivudual sales per customer, consumer
or user (satisfied clients buy more of the same products and services).

ÎMore cross-selling, since the customers are more likely to buy other
products or services from the company.

ÎMore new customers acquired

through word of mouth
communication , the references from satisfied clients, etc.

ÎLower expenses in traditional marketing activities
(advertising, sales promotion and so on).

¿Why is customer service important?
ÎFewer complaints so therefore fewer expenses solving them.
ÎBetter image and reputation of the company.
Î A clear differentiation of the company over its competitors (even though
there products and services are similar to those of their competitors , customers
perceive as different and even as unique).

Î A better internal working climate, since employees are no longer
under the pressure of frequent complaints form users, customers or consumers.

ÎBetter internal relations inside the staff since all of themwork,
together, towards a common goal.

ÎFewer complaints and absenteeism from the staff (higher
productivity).

ÎLower staff turnover.
ÎMore market share.

(according to Bernd Schmitt)
Functional characeristis are considered based on
theri importance. Its presence iin the product that
is most useful (defined as the sum of weighted
features). Anything that does not fit is “image”,
“irrelevant” or “meaningless”

Acknowledging the need
Competnece is produced inside a
restricted andefined product category:
the battle field of the product managers
and brand managers

Searching information
Evaluating options
Buying anf consuming

ƒ Regression models
ƒ Positioning maps
ƒ Joint analysis (functional
advantages perceived by the
consumer)


[ soemthing to take into account … ]

“The essential difference
between
emotion and reason
is that …

[ something to take into account … ]

“The essential difference
between
emotion and reason
is that …
emotion leads to action
while
reason leads to conclusions.”
Kevin Roberts
[Lovemarks: the future beyond brands]

“the wallet is closer to
the heart than it is to
head.”
d2
$

d1

d1 < d2


9 Less loyal to a brand

More

9 Wider varierty of
choices (election)

heterogeneous

9 More diverse needs
9 Makes decisions at the
selling point

and harder to
reach
customer
It could be up to the


80%

Adapted from Pajunen y O’dell

1. They accept your invitation to be loyal
2. They frequently change segments and mislead our strategies ,
their behaviour is unpredictable
3. They are smart and are well-informed

4. They are cynical and sceptical
5. They ar not willing to “fight” (they just leave), they rather “harm
consciuosly”

6. They are interested in the others’ experiences
7. They know their own value
ey
y
w
ir wn ue
n
8. They are proud to be “butterflies”: they know they have the
power.


Adapted from Pajunen y O’dell

Excelent service
(feeling of being
exceptional)

Put the price on
the second place
based on their
”level” as a
customer

Pride of belonging
“red carpet”

Routines and
“lazyness” to look
for another
supplier, sale cost
based on comfort

“one to one”
treatment .
(what they value
more than the link
“companyperson”)


Adapted from de Pajunen y O’dell

9 Suspicious and
cautious
9 Experienced
9 Skeptic
9 Impatient
9 Unpredictable
9 Highly informed
9 Non conformist
9 Bad-tempered
9 Bothersome
Troublesome
9 Somebody has to pay
for what’s happening

Adapted from Marketing de Servicios – tendencies 2014

Hiper connected
(AAA)
9 Any Device
9 Anywhere
9 Anytime
The Rise of Generation
9 Connected
9 Communicating
9 Content-Centric
9 Computerized
9 Community-oriented,
9 always Clicking

C

(AAA + Generation C)


“It’s not the products but the

processes that create the
products,
what adds up to the long term
success of the companies”.
Michael Hammer & James Champy
Reengineering the Corporation: A Manifesto for Business Revolution

115

¿What do

CUSTOMERS
EXPECT from
US?

Fuente: Berry, Parasuraman & Zeithaml

Reliability- Credibility

E
P

“we don’t have
customers , we
have believers”
Carlos Navarrete
DIES business partner

Customers can believe & trust
In our standard quality

responsiveness

E
P
The employees are willing to provide the service when
w
willin
the customer needs it.

Courtesy

E
P

“we just sell the
product, we
don’t
manufacture it.”
An important
department store in
Perú

The staff tr
treats the customers kindly and attentively
reats
they don’t react negatively with an angry customer.

Accesibility

E
P
Adequate location and schedules, signaling,
e loc
services provided match the customer times,
managers willing to listen.

Communication

E
P
The staff explain clearly without using technical
explains cle
ns
words; they listen patiently.

Understanding

Som
S mebody c
Somebody calling
y
himself
himse
elf

customer asks

E
P

for soemthing called

service

Custom
Customers expect to be heard and helped; the satff
mers
“understand the customers’ side”.
“Personalized” service (segmented).

Professionalism

E
P
The staff knows how to provide the requested
service. Know your products!

Security

E
P
The company cares about the customers’ physical and
econo
economic safety, (data) confidentiality.
omic

Comunication
is very
important

!

Listen
carefully

make

questions

Film:

The beaver and the shepherd


Don’t “jump” to

conclusions
Often, problems
occur due to
a poor communication.

!

Film:

Nose operation


Before going on
Lets’ make a short summary


[ something to keep in mind ]

“the key difference between emotion
and reason is that …


[ something to keep in mind … ]

emotion end up in action
while
reason ends up in conclusions.”
Kevin Roberts [Lovemarks: the future beyond brands]


Final Considerations
“Not everything
that can be
counted counts;

Not everything
that counts can be
counted”
Albert Einstein
fuente: www.marketingdeservicios.com


“what’s important is invisible to
the eyes”
Antoine de Saint-Exupéry
en El Principito


“90% of what we call
‘management’ consists of
making things hard for
those who must do
things.”— P.D.

ÎFidelity (trust) is not Loyalty.
ÎThe CRM [technology without strategy] guarantees
nothing.

ÎClassical Marketing doesn’t work anymore.
ÎCustomer service is a key element to keep customers.
ÎA radical change in the communication paradigms:
we moved from publicity and (massive) promotion to
personalized communication.

ÎQuality is not enough; we need kindness (human Q).

complaints
book

(“public”)
Commitment of
quality

The “employee”
of the month!


Now…
let´s see traditional
(transactional)
marketing

141

CAUTION
there's no space
for mistakes here

142

Process of Strategic Planning

Focus the strategy with quatitative and cualitatove criteira
Customers

Company

S.
W.
O.
T.

Segmentation
& Target

Product

Place

Target
Market
Differentiation&
Positioning

Price

Promotion

Competitors

Marketing External Environment
143

SEGMENTATION
What’s a segment?
Where do they come from?
Why we need segmentation?

144

UNSEGMENTED MARKET

SEGMENTED MARKET

DIMENSIONS: THE CONCEPT, THE TECHNIQUE AND THE STRATEGY
145

SEGMENTATION
9 Generally ,a company cannot serve all the customers in a
big market.
9 They are numerous, disperse and their purchase
requirements vary.
9 Any competitor, will be in a better position to reach specific
segments.
9 The company identifies the kind of buyers that differ the
most in their product requirements, in how they respond to
the marketing mix or both.
9 The company has to idnetify the most attractive segments
that it can serve more efficiently than the competence.


INTRODUCTION
9 Today, massive markets are becoming less massive into a
lot of micromarkets characterized by different lifestyles that
are looking for different products, in different distribution
channels they see in different mass media (diff mkt mix).
9

Differentiated or concentrated segmentation allows the
adjustment of products, prices, distribution channels and
communication to reach the target market more efficiently


INTRODUCTION
“Mass society is an illusion”
“We have entered the era of
demassification”
Alvin Toffler, in: “The third wave”

“Fragmentation
has placed the power
into the consumers’ hands”

SEGMENTATION

Nadal vs Steffi
Differences between men and women

To be instrinsincally homogenoeus (similar)
• Consumers from a segment should be as similar as possible regarding their probable
f
h ld b
l
bl
d
h
answers to the mix of variables in marketing and their dimensions of segmentation.

Heterogeneous among themselves:
• Consumers from many segments should be as differetnt as possible reg
regarding their
probable answers to the mix of variables in marketing.

Big enough:
• To guarantee the profitability of the segment.
segment

Operational:
• To identify the clients and choose the mix of variables of marketing. The demorgraphic
dmiension should be included in order to make decisions regarding the place and
promo.

Massive
Marketing

unsegmented
Focused on a segment
t

Segmented
Marketing

Concentrated

Niche
Marketing
M

Individualized

Ma
Marketing
121


SEGMENTATION

GEOGRAPHIC
IC

DEMOGRAPHIC
IC

SOCIOECONOMIC
IC

PSICOGRAPHIC AND LIFESTYLES
ES

BEHAVIORAL
AL

BY TYPE OF USE
SE


Men & Women Brain


Link al video

DIFFERENTIATION
& POSITIONING
What’s Differentiation?
Why we need Differentiation?
What’s Positioning?
Why Positioning is important?

154


Customers

Company

S.
W.
O.
T.

Segmentation
& Target

Product

Place

Target
Market
Differentiation&
Positioning

Price

Promotion

Competitors

157

DIFFERENTIATION

“If I'm going to
sing like
someone else,
then I don't need
to sing at all.”
Billie Holiday


158

DIFFERENTIATION

M. Porter (1996)

“The essence of strategy
is choosing to perform
activities differently than
rivals do.”

159

DIFFERENTIATION
definition

ƒ

To establish a series of
MEANINGFUL DIFFERENCES ,
to distinguish the supply from
the company from those of the
competitors


DIFFERENTIATION


DIFFERENTIATION
THE COMPETENCCE

IS NOT WON COMPETING …

SUCCESS COMES FROM
THE FACT OF BEING DIFFERENT.
the new

„ Process
„ Provision –
“Moment of truth”
„ People-person
„ Physical evidence163

4P
concept


163

DIFFERENTIATION
4 Ways to generate value [5 really]
1.

BETTER PRODUCT

2.

NEWER

3.

FASTER

4.

CHEAPER

5. ABILITY TO CHANGE

DIFFERENTIATION
4 Ways to generate value [5 really]
1.

BETTER PRODUCT

2.

NEWER

3.

FASTER

4.

Be very
careful

CHEAPER

5. ABILITY TO CHANGE

Competitive Advantage

ƒ

What’s a competitive
advantage?

COMPETITIVE ADVANTAGE

“Something”
my company
has

Competitive
Advantage

“Something"
that my
competition
does not

“Some
“Something"
my market
m
wants

Dr

167

COMPETITIVE ADVANTAGE
“We have only two sources of
competitive advantage:
ƒ The ability to learn quickly
more about our customers
than our competitors do, &
ƒ The ability to quickly convert
that knowledge into action
faster than our competitors
do.”
Jack Welch, CEO de GE

168

DIFFERENTIATION
4 dimensions to differentiate
1. PRODUCT

2. SERVICE

3. STAFF

4. IMAGE

CHARACTERISTICS

DELIVERY

COMPETENT

SYMBOL / BRAND

QUALITY
PERFORMANCE

INSTALLATION

COURTESY

MASS MEDIA

CUSTOMER
TRAINING

CREDIBILTY

ATHMOSPHERE

RELIABILITY

EVENTS

COMPLIANCE WITH
SPECIFICATIONS

DURABILITY

CONSULTING
SERVICE

RELIABILITY

REPARIRS

REPAIR CAPABILITY

MISCELLANEOUS
SERVICE

STYLE

RESPONSIVENESS
COMMUNICATION

DESIGN


PRODUCT VALUE

SERVICE VALUE

STAFF VALUE

Differentiation
by Value
TOTAL VALUE
FOR THE
CUSTOMER

CUSTOMER
NET
VALUE

IMAGE VALUE

MONETARY PRICE

TIME COST

TOTAL COST
FOR THE
CUSTOMER

ENERGY COST

PHYSICOLOGICAL
COST


DIFFERENTIATION
7 Criteria to validate a differentiation strategy:
1. Important.
2. Distinctive.
3. Superior.
4. Communicable.
5. Exclusive / Unique.

6. Affordable / Accessible
(on “my budget”).
7. Profitable.


171

DIFFERENTIATION
7 Criteria to validate a differentiation strategy:
1. And also you can …

Video: Bud - Drinkability

Video: Jet Blue

Inverse Differentiation

172

beware hyper competition
“immutable” (strategy & marketing) rules.

big fish eats’ small fish

173

beware hyper competition
… they are not any more.

fast fish eats’ slow fish

174


Clients

Company

S.
W.
O.
T.

Segmentation
& Target

Product

Place

Target
Market
Differentiation&
Positioning

Price

Promotion

Competitors

175

The Market’s

Life cycle

Cycles are geting always shorter …


PRODUCT’S LIFE CYCLE
definition
ƒ

The Life Cycle of the product: describe the stages
through which the idea of a new product
goes, from beginning to end:
ƒ Introduction in the market
ƒ Growth in the market

ƒ Maturity of the market
ƒ Decline of sales

MARKET’S LIFE CYCLE

PROFIT

Máx.

SALES

LOSS

0,0

I&D

PROFIT
Introduction

Growth

Maturity

Decline

time

INTRODUCTION - GROWTH


MATURITY


BCG MATRIX & LIFE CYCLE
Product’s life cycle
Máx.

0,0
I&D

Introduction

Growth

Maturity


Decline

LIFE CYCLE. Management & Development
stage

Introduction

growth

maturity

decline

Competitive
situation

Monopoly or
monopolistic
competence

Monopolistic
competence
or olygopoly

Monopolistic
competence
or olygopoly
oriented to
pure competence

Pure
competence

product

One or a few

variety: try to find
the best product
Create familiarity
with the brand

All the products
are the same;
the brand wars
grows

Some products
abandon the market;
price war

Trend to a
more intense
distrubution

¿new emergent
markets?

place

promotion

prize

Build channels
Maybe selctive
distribution
Create basic
channelsr
Innovative
information

Create selective demand

high? descreme
bajo? penetration

Deal with competence(specially in the ologopoly)
Price reduction offers

persuade / remember
(frenzied competence


PRODUCT


In 1954:

How will looks lihe a home computer in 2004

Product: is a comny’s offer to
satisfy a need
What the companies really sell is
the satisfaction, use or the
benefit the user wants


9

The idea of “product” as potential satisfaction
or benefit for the customer is the most
important

9

The industrial customer or manufacturer will
be interested in the utility they will get once
they use the “product” and sell it again


physical good
combination

service

Nails, (some) canned soup,
electric cables, tubes

100%
Emphasis on
the physical
good

Food in a restaurant, car
tunning
Bank services,
haircuts, mail service.

Commodity
diferentiation
0%

0%

Emphasis on 100%
the service

Key Differences: MDS www.marketingdeservicios.com
Products

Service

Tangible

Intangible

Standard supplies (similar)

Heterogeneous and variable
[“each” moment of truth is not
necessary the same]

Producction is separated
from consumption [use]

Production and consumption
[use] are simultaneous

Long-lasting [stock]

Non long-lasting [Non Stock]

[Almost] No companycustomer contact

Frequent company-customer
contact

Standard demand inside the Customers have their own
same category
personal demands regarding the
same service.
next …

Key Differences: MDS www.marketingdeservicios.com
Products

Service

The customer does not
participate in the
production process
(manufacturing)

Customers participate in the
production process

“Personalization” of a
product is difficult & hard

It’s easy to [must] pesonalize the
supply

The supply can be
“accurately” defined
before handing it to the
final customer or user.

It’s impossible to control all the
characteristics of the service the
final user or customer gets.

Quality perception
depends on internal
quality.

External quality is as or more
important than internal quality.


Product’s type and variety
r

The types of product begin with
the type of customer
ƒ

All the products fit in one of the 2 general
groups based on the type of customer:

ƒ Conmsumer Products: orientend to the
final user

ƒ Industrial Products : oriented to make
other products

Comsumer products
ƒ The consumer products are classified in 4
groups:

ƒ Convenience products
ƒ Comparision poducts

ƒ Specialty products
ƒ Unsought products

PRODUCTS: GOODS AND SERVICE
Consumer products - SUMMARY
Type

Sub- type

Examples
Exam
Examp

Basic

Chocolate; magazines
ICE; car batery

Homogeneous
Comparision

Impulse
Emergency

Convenience

Salt

Mobile Phone Samsung vs. LG

Heterogeneous

videocamera
X ray machine

Specialty
Newly unsought

Unsought

Trout fillet; motorbikes

Normally unsought

Finisterre Burial insurance

The same product can be seen in
different ways simultaneously

“The customer needs the brand to simplify his
task of buying products”
Today, products offer similar benefits and differ very little from each other.
The differentiation is reached through communication. It plays an important
role in the selection process using mechanisms linked to feelings.

“Brands must be able to provoke people’s
feelings”


PRODUCTOS: BIENES Y SERVICIOS

BRANDS
9 Renokwn brands make buying easy
[for example a supermarket has 25,000 items / now
60,000!]
9 A good brand reduces time and sale efforts.

9 Sometimes the only element of the marketing mix that
competitors cannot copy [unless you are in a not
developed country].
9 Speeds up the acceptance of new product associated
to it.


When is using a brand is convenient
1.

The producy is easy to identify by the name or the
brand

2.

The quality of the product is the optimus value ofthe
price and it is easy to keep.

3.

A generalized and reliable distribution is possible
[coverage and distribution]

4.

Strong demand able to deal with the market price to
make it profitable investing in the brand

5.

It’s possible to get escale economies

6.

Good exhibition points (shelfves, windows) are easy
to get …

“Group of assests
[and liabilities]
linked to the name
and the brand that
add r [or take] the
value given by a
product or service
to the company
and/or its
customers.”

Strategic importance of packing
ƒ The packing includes the product’s protection and
promotion
ƒ It makes it easier to use and store it.
ƒ Prevents deterioration and damage.
ƒ Good packing makes product’s identification easy &
promotes the brand in the SP (sales Point)
ƒ It should link the product with the rest of
the marketing strategy.


Strategic importance of packing
ƒ A good packing “usually offers” a better promotionap
effect than publicity, becasue it is seen at the store
where people buy.
ƒ It should take the smallest space at the store, be
protected, easy to pile up, transport and exhibit.
ƒ It should be identified using a bar code (or new tech…)


Warrantee
9 Warrantee : what the seller promises about the
product
9 The laws, the needs of the client and the offers
form the competence must be taken into account.
9 The common law states that manufacturers must
endorse their products, even if they don’t offer a
warrantee.

9 The warrantee should be available before the
purchase.


Warrantee
9 The warrantee is an attraction that can improve
the marketing mix
9 The risk to offer a warrantee is higher for a service
than for a product.
9 The warrantee costs must be included price


PRICE



205

I have a question for you


206

¿Is the

PRICE
the most important
variable of the
marketing mix?

207

Introduction

“If you pay peanuts …

… you get monkeys”

208

“I buy; then I exist.”
Rodolfo J. Cremer, MBA Ph.D (c)

“You are what
you buy”.
Guillermo D’Andrea, CAMP
2006


“if you can pay, you can stay”
“You value how much you have”.
Brother Fred Fink SM, from my [Christian] school, 1980 – 1984.

FLIGHTS FROM 19 EUROS

WE ARE NOT JOKING, WE ARE GERMAN
From Spain to Germany up to 50 times a week


Objectives & Price Policies
introduction
9

Price is one of the 4 main variables the marketing
manager controls .

9

(but) Its effects are directly (& immediately) seen
in the sales and profit (financial statements)

Price is what is given in exchange of the
benefits got from the rest of the marketing
mix. Therefore it directly influences the
value for the customer.

introduction
Basically the marketing manager must decide:
ƒ
ƒ
ƒ

Objetives and policies to set prices,
Which prices problems they will face, and
How the company will solve it
1. how flexible the prices will be

2. At which level they will be stablished along the life cycle
of the product
3. Who and when disccounts and sales
4. How will the transportation cost be handled
5. Elasticity

Objectives & Price Setting
Expected performance

Profit oriented
Maximize profit

Objetives
of prices

Sales increase
in units or dollars

Sales oriented
Market share growth

Status Quo
oriented


Match the
competence price
Competence unrelated
to the price

Season
[season]

Size

Price
Discounts

Cash
Discount

Offer price

Commercial
[channel]

Price Setting Demand Oriented
Psychological

Odd- Even

“bait” [hook]

Leader

Prestige

Methods for
price setting
demand- oriented

Price range

Set forth
[demand]

Value-of-use

Reference

The taxi driver example


220

The taxi driver example
Asks for S/.200
Pays S/.10 x 24 days
In total he pays S/.240 after 24 days…
¿What was the annual interest rate?

1,441% !!
[0.76% per day]

Go to excel

221

The house-to-house
clothes salesman

(In a extremely poor zone in Lima)

222

The house-to-house
clothes salesman
He pay S/.20 (in Gamarra) for a pair of jeans (trousers)
He sells it at a S/.1.00 a day during 30 días
He gets S/.30 in the end (50% more in 30 days) …
¿What was the annual interest rate?

12,875% !!
[1.36% a day]

¿Sir,
what’s a
“Sol” a
day,?

Go to excel

223

Promotion and Demand Curve
Demanda
Elasticity
Price

Price

Price

D

D1

D

D2

0

D

D

Quantity

A. Make it less elastic

0

Quantity

B. Move it ot the right

0

Quantity

C. Both: less elastic
and to the right


224

c
elasticity
Mathematically, it isexpressed in the following way,
where: Ed elasticity, Qd required quantity and P price:

ƒ Demand elasticty is the degree at which the required quantity (Q) responds
to the price (P) variations of the market. In this case, given certain prices (P)
and some quantities (Q) and a (P*Q)=income, then:
Â When the price (P) reduction increases the required demand (Q) so much that
the multiplication of the (P * Q) be higher than the original one , an elastic
demand is present.
Â When the price (P) reduction increases the required demand (Q) in similar
quantities of the (P * Q) , the elasticity is proportional or the same as a 1.
Â When the price (P) reduction decreases the required demand (Q) so much that
the multiplication of the (P * Q) is lower than the original one, the elasticiy of a
good it is said to be less elastic or rigid.

225

Let see the example
of Beer


226

The elasticity of Beer
Background:
ƒ You work in a top cafeteria in a 5-star hotel located in San
Isidro (business district in Lima).
ƒ Price of Beer P0 (all the brands) = S/.10.00
ƒ Daily average sales (Q0) = 15 bottles of 330ml

Opportunity:
ƒ Because of the FIFA World Cup Qualifications (where Peru will
be elimanted while others qualify), you decide to place giant
screens and make a special offer of snacks to attract people to
watch the soccer matches.


227

Preliminary results:
ƒ The campaign is successful. The sales increased.
ƒ Soccer days are booked which completes the cafeteria’s
capacity.
ƒ The general sales of snacks and mixed drinks, have rapidly
grown (& the average ticket increased).
ƒ However, the daily beer sales is still constant (15 bottles a
day).
Question:
ƒ What has happened with the sales of beer and soccer?
ƒ There is no correlation between them?


228

Experiment:
ƒ An experiment with beer it’s done. Its price is lowered – only on
soccer days at P1 = S/.6.99 and the sales rapidly grow at more
than Q1 = 180 bottles a day (and the stock was over on the first
day, then the sales could have been higher -but we dont know
how much…-).
Question:
ƒ Is beer, in this case, an elastic good?
ƒ What has happened with the gorss margin (per unit) assumin a
unitary cost of S/.1.50 per bottle?
ƒ What decision would you make based on these results and
analysis?

229

Po
10

P1
6.99

Prom
8.495

Qo
15

=

Q1
180

Qprom
97.5

-4.77613085

Demand's price elasticity:
(Q1 - Qo)/Qprom
(P1 - Po)/Prpom
ƒ
ƒ
ƒ
ƒ

Every 1% of price reduction, there is a 4.78% increase in the requested quantity
The sign is not considered for the interpretation. The absolut value (4.78) is
considered for the comparison
Since the result is higher than 1, we say the elasticity is high.
Price elasticity is always negative becasue the curve is negative.


230

12

10

Precio

8

6

4

2

0
0

20

40

60

80

100

120

140

160

180

200

Cantidad
Esc 1

Esc 2


231

Unitary Price
Unitary Cost
Unitary Gross Margin
Margin %

ƒ

Esc 2
S/.
6.99
S/.
1.50
S/.
5.49
366%

U sales
sales S/.
Costs S/.
Gross Margin S/.

ƒ

Esc 1
S/. 10.00
S/.
1.50
S/.
8.50
567%
S/. 15.00
S/. 150.00
S/. 22.50
S/. 127.50

S/. 180.00
S/. 1,258.20
S/. 270.00
S/. 988.20

-35.4%

675.1%

The unitary gross margin is reduced from 567% to 366%. Generally speaking, you
get 35.4% less per sold bottle.
However, the gross margin grows 675.1%, product of higher requested quantity.
Since this is an elastic good, the requested quantity greatly makes up for the loss
due to the price reduction.


232

elasticity

Elasticity
-some conclusionsƒ If the demand is elastic to the price, it is
possible to lower the price to increase the total
profit

ƒ If the demand is not elastic to the price, it is
possible to increase the price to get higher
profit.

233

elasticity

Elasticity
-some conclusionsFactors that determine the lack of elasticity of the demand:
1.
2.
3.
4.

There are a few or no competitors
Buyers do not easily perceive the higher price
Buyers slowly change their consumption habits
Buyers think higher prices are justified by quality, infalation or
other reasons


234

Other factors that influence Cost & Price
(usually hidden)
ƒ

The time orders are processed

ƒ

Procedures to process orders

ƒ

The place where the inventary
is storaged

ƒ

Accuarcy of the order’s
delivery

ƒ

Cost of rejected or returned
orders (freight, time, damaged
product)

ƒ

ƒ

Rotation rate and finnancial
costs

Size or variety

ƒ

Delivery costs [fake or false
freights]

ƒ

RE-processing costs due to
defficient quality

ƒ

Robberies, shortage, obsolete
goods

ƒ

Direct costs: insurance,
electricity, staff, maitenance

ƒ

Indirect costs [service, systems
and security staff]

ƒ

Lost sales due to shortage,
delivery time, etc …


235

Key factors that influence Price Setting
Company objectives
Target price
Price
flexibility

Experience
curve
Breakeven
point

Demand’s
response
Market’s
Life Cycle

Elasticity

Discounts
and bonus

Costs

Price
setting

Competitors
and
substitutes Distribution and
Surcharge chain
[mark-up]
In the channel

Law,
restrictions
and price control
Geographic
prices’
conditions


Price of other
products of
the same line

236

The war of prices!

Who wins &
Who loses the price war?

Let´s talk about McDonald´s & Starbucks

Fuente: Ph.D. Moez Limayem, Dean College of Business USF. Conferencia en USIL el 9 de mayo, 2013.

240


ƒ

ƒ
ƒ
ƒ
ƒ
ƒ

¿How much does a hamburger cost at
McDonald’s?

¿How much does coffee cost at Starbucks?
¿Do all McDonald’s in (Lima) have the same
prices?
¿Do all Starbucks?
¿Should it be like that? ¿What are the pros and
cons?
And ¿how do you think it works in the USA?


241


ƒ

ƒ
ƒ
ƒ
ƒ
ƒ

At Starbucks USA (in Lima) all locals have the
same price for its products (inside each country).

At McDonald’s (USA), they ARE NOT.
¿How much does the price of a hamburger vaaries
between teh cheapes and the most expensive
local in US?
650%

¿Where is the most expensive hamburger sold?
¿Why?


242


Clients

Company

S.
W.
O.
T.

Segmentation
& Target

Product

Place

Target
Market
Differentiation&
Positioning

Price

Promotion

Competitors

243

PLACE


Domestic gas distribution.
Lima, Perú.


Montreal, Canadá.

introduction
PLACE [also meanes, distribution]:
“to put the goods and services
in the right quantity and place
when the customers wants them”
ƒ

Distribution channel: series of companies or
people that participates in the flow of
products from the manufacturer to the final
consumer.

introduction
ƒ

Responds to the time and place use.

ƒ

The type of product helps define how much
exposure in the market is needed according
to each geopgraphic region.

ƒ

The same target market must show the same
attitudes therefore it should be satisfied with
the same type of distribution.


Channels’ system
ƒ

Channels’ system can be:
ƒ Direct, when the maniufacturer is in
charge of the complete distribution, or

ƒ Indirect, when it is in charge of
wholesaler, retailer or other specialists.


Channels’ system
Direct Distribution

Indirect Distribution

• Total control of the variables of the
marketing mix

• Gives part of the control over the
marketing mix to the intermediary

• It’s not easy to work with indepent
intermediaries who have their own
objectives

• An effort should be coordinated to meet
common objectives ( it’s not easy n the
channel has too much power.)

• When there’s a new product there aren’t
interested intermediaries

• It is the easiest way to enter
international markets

• When there is a lack of finnancial
resources or knowledge to develop a
distribution channel

• The intermediaries invest in keeping an
inventary and a commercial structure
and take the risks of credit.

• More used for industrial products with a
few grouped consumers

• More used in products where the
consumers are disperse.


More control

Lower costs
Added value i the
in
production process
pro

Some
Reasons
To choose
Direct
Distribution

Direct c
contact with
the cust
customers’ need
Fast
Faster response and changes
in the Marketing Mix
There isn’t any
available intermediary channel


Specialized intermediaries
p
Channel run by a
manufacturer

Product

Place

Channel run by a
retailer

Product

C
Price

Promotion

Place

C
Price


Promotion

PROMOTION


definition
ƒ

Promotion: consists on communicating
information between the seller and the
potential buyer or other memebers of the
channel with the objective of influencing in
their attitudes and behaviour
ƒ
ƒ

ƒ

There is [normally] inmmediate feedback that helps to make
appropriate changes or adjustments.
Sometimes is very expensive.

Personal sales Î refers to the “one-toone” sales, interacting with customers.

characteristics
ƒ

A seller attracts more atention than an add or
a shelf.

ƒ

He can addapt (the speech directly with the
customer) based on his partner’s
feedback,culture and other influences of the
context or the behaviour.

ƒ

He can ask questions to get to know his
prospect’s interests.

Massive sales
ƒ

Massive sales: consists of establishing
communication with big quantities of
prospects at the same time.
ƒ

It’s less felxible than personal sale.

ƒ

It will be cheaper if the target market is big and disperse.

ƒ

There are two types.
ƒ

Publicity [advertising]

ƒ

Publicity for free [publicity]


Introduction [Advertising]

ƒ

Can cost a lot of money.

ƒ

Can rapidly reach many people.

ƒ

Can produce a combination of short and long
term results.

ƒ

Can greatly contribute to position the marketing
mix.

Objectives of Advertising & Publicity

ƒ

Add & Publicitary objetives should be more
specific than the personal sales.

ƒ

A seller can modify his presentation, but an Add
should reach a target audience with a fixed and
specific communication.

Introduce new products

Position brands
Get distributors
(Commercial – Distribution Channel)
Ongoing contact
(“top of mind”)

Strategic
Decisions
to Establish
Add & Publicity
Objectives

Support sales force
Inmediate response
Keep relations
(Confirm the purchase)


Free Add Î Publicity
ƒ

No Pay Add: is any "free" form of non-personal
presentation of ideas, goods or serviceses.

ƒ

Try to call attention to the company and its offer
without having to pay for the cost of mass media.

ƒ

If the company has a very new message to
communicate, publicity (non paid add) can be
more efficient than the Add (pay).


Sales Promotion
ƒ

Sales Promotion: designate promotional
activites –which are not advertising or publicity–
that stimulates the interests, the try-out of the
product and its purchase by the final consumer or
other members of the channel.
ƒ It can oriented to the public, the
intermediaries or the company staff.

ƒ It can be quickly implemented and produce
fast & short-term results.

Sales Promotion
ƒ

Sales Promotion

ƒ In fact, it genrally has the objetive of
producing inmediate results.
ƒ Usually uses more money.
ƒ There are differents types:
ƒ
ƒ
ƒ
ƒ

Coupons
Raffles
Commercial exhibitions
Sponsoring


Final User / Consumer
oriented
Contest
Coupons
Isle exhibition
Free samples
Commercial exhibitions
Materials at the sales
point [POP]
Signalling
Prizes
Sponsorship

Intermediary
oriented

Sale Force
oriented
Sales
Contests
Discounts
Bonus
Sales contest
Meetings
Calendars
Clients’ portfolio
Gifts
Shelves
Commercial exhibitions Sales help
Catalogues
Training material
Meetings
Merchandising


Communication Strategies
There is NO mix of ideal communication
for all the situations.

a basic strategy is generally chosen:

Push

Pull

The Push Strategy
ƒ

ƒ

The PUSH Strategy: to push a product through
a channel means to use the promotional effort
(personal sales, publicity and promotion) to help
sell the marketing mix to all the possible
memebers of the channel.
Channel cooperation and unity is seeked
(fundamental).


The Pull Strategy
ƒ

ƒ
ƒ

ƒ

The PULL Strategy: it means to make the
consumers ask for the the prduct to the
itermediaries.
Promotions and efforts are oriented to the final
consumer.
If the retailer doesn’t have the product, he will
lose sales: “the public asks for it”.
Intermediaries are not the goal at that moment,
only the final consumer.

Push & Pull Strategies
ƒ

(A combination of) Both strategies are (must)
generally used simultaneously, at some degree.

ƒ

Using both reduces the risk of failure and
increases the probability of success.

ƒ

The mix (of Push & Pull) changes if we are
dealing with final or industrial customers.


Example:
Commercial
campaign, Objetives,
Metrics and Results.
“you can not manage what
you cannot measure”.

Inserted or
Mass Media
Adds

Sales
campaigns and
exhibitions

Exhibitions at
fixed points


278

Second-hand
Sales adds

Prospects

Inserts or Mass
Media Adds

Phone

Exhibitions at
fixed points
(stores)

Temporary sale
point

Sellers

Telemarketing:
Entering the prospect in the system

279

Examples of Adds (inserts):

Prices and sales
Bonus for returning

Technical details
and specifications

Free phone line 800
+ associated line
(L - D, 9am a 8pm)


280

Basic models and
benefits

Especial prices and
offers

Free phone line 800
+ associated line
Sale points
(L - D, 9am a 8pm)
addresses © Dr. (c) Rodolfo J. Cremer – MdS Marketing de Servicios

281

Sales
campaign


282

Sales Points

Head
Office

283

Second-hand

Jockey Plaza, mall


284

Other Sales
Points
Pandero

Suzuki / GM San Miguel


285

T l
Telemarketing :
k ti
Entering the prospect in the system

c
d

e

TMKT calls

Feedback

Prospects
In
Inmediately (when picking up the phone)
E
Ef
Efectiveness of Add & Publicity and sale point
¿How did you know about 800? ¿How did you get to the SP.?
H

48 Hours
Selesman (vendor) quality service
After 30 days:
If you bought (which brand. Model, new/second -hand)
If you haven’tRodolfo J. Cremer – MdS Marketing de Servicios
(a second-hand is offered)
© Dr. (c)

286

Telemarketing:
Entering the
information

System

•Efectiveness of Add & Publicity.
•Closing Rate (per selesman,
product line, boss...).
•Customer Service Quality.
•Competence (who are we
REALLY competing with, prices,
lost sales rate, etc.
• Technical Support quality.
•Special sales of accesories,
etc...


287

ƒ
ƒ
ƒ
ƒ
ƒ

Concentration of the sales force only in the sales
process (not in the generation of prospects).
Strict performance measurement (even per salesman).
Orienting all the commercial effort only to “TRUE
PROSPECTS”.
Generating very strict and detailed measuremetns
reports use to make decisions (on time).
Generating a prospect’s data base that can be revised
with new products, new offers, etc...

288

ƒ

ƒ
ƒ

The general closing rate is 10% (Customer / Prospect).

130 prospects respond the first day. 50% of it the second
day, and 50% of it from the thrid to seventh day. That is a
total of 260 prospects per Add.
Out of all the prospects, 35% call for Suzuki cars, 35% for
second-hand cars, 20% for GM-Chevrolet and 10% for
motorbikes and mototaxis.


289

Economic Result of the Advertising Campaign
Insert cost
Total number of pages
Unitary cost per page

$20,000
8
$2,500
Suzuki
Automóviles
3
$7,500

GM
Automóviles
4
$10,000

90

Motocicletas

Usados

Totales

0.5
$1,250

0.5
$1,250

8
$20,000

50

30

90

260

9
15%
$50,000

5
10%
$100,000

3
30%
$4,167

9
10%
$12,500

26

$15,500

$15,500

$2,120

$5,000

3.2

6.5

2.0

2.5

estimated gross sales

$139,500

$77,500

$6,360

$45,000

$268,360

estimated sales cost

$118,575

$69,750

$4,452

$40,500

$233,277

$20,925

$7,750

$1,908

$4,500

$35,083

$13,425

-$2,250

$658

$3,250

$15,083

179%

-23%

53%

260%

75%

Number of pages
prorated cost
Total of genenrated prospects
(7 days)
closing rate (10% )
gross margin
balance point
average net value per unit
average units for balance point

expected gross margin (salessales cost)
Campaign contribution (Gross
margin - prorated cost

Contribution / Investment


$166,667

290

ƒ Marketing de Servicios, España.
http://www.marketingdeservicios.com/
ƒ Marketing: un enfoque global.
McCarthy Jermome; Perreault, William
13a Edición
ƒ Fundamentos de Marketing de Servicios:
conceptos , estrategias y casos.
Hoffman; Bateson.
Ed. Thompson.


291

Questions?
Dr
r.

292

Final Conclusions
Seminar Conclusions’

1. abc
2. abc
3. …


!

thanks


Rodolfo J. Cremer, MBA, Ph.D. (c)


Inseec - Strategic Marketing - Rodolfo Cremer

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