1. Gaining customer and market insight
through business intelligence
Product and Brand Management (23C630)
Ch. 5 & Ch. 6
September, 12th
Giuseppe Pedeliento, University of Bergamo (Italy)
Visiting Aalto University School of Economics,
Department of Marketing

2. Learning objectives
After the lecture, students should be able to
– Describe common practices for both the collection and the
analysis of information about competitive brands and customers
– Understand how basic tools and frameworks can be used to
facilitate the before mentioned processes
– Explain how this activity takes place through practical examples
2

3. Ch. 5
COMPETITOR ANALYSIS
3

4. Competitor Secondary data Primary data
Analysis System Key questions:
- Who are they?
- What are the
competing product
features?
- What do they
want?
- What is their
current strategy?
Differential
competitor
advantage analysis
i.e. Who has the
competitive product
advantage?
What are they going to
do?
4

5. Secondary Sources of Competitor
Information InternalCustomer
Communications Sources Local
Consultants Newspapers
Annual
Trade Press Reports
Patent
Internet Secondary data Filings
Promotional 10Ks
Literature
Business
Trade
Press
Associations
News Electronic Government
Releases Databases
5

6. Primary Sources of Competitor
Information Investment
Bankers
Consultants/
Specialized
Sales Force
Firms
Primary
Data
Suppliers
Employees
Customers
6

7. Other Sources of Competitor Information
 Ethics? Help-Wanted
Advertisements
Hiring Key
Employees Trade Shows
Primary
Data
Monitoring Plant Tours
Test Markets
Reverse
Engineering
7

8. Competitor analysis tools
• Product features matrix
8

9. Assessing Competitors’ Strategies
• Marketing strategy
–Comparing value chains
–Marketing mix
• Pricing
• Promotion
• Distribution
• Product/Service capabilities
9

10. The value chain
Firm Infrastructure
Support Human Resource Management
Activities Technology Development
Procurement
Inbound Marketin
Operations Outbound
Logistics g and Service
Logistics
Sales
Primary Activities
10

11. The Marketing Mix
• Pricing
• Promotion
• Distribution
• Product/Service capabilities
11

12. Competitor Information to Collect
• Ability to conceive and design
• Ability to produce
• Ability to market
• Ability to finance
• Ability to manage

13. Differential Competitor Advantage
Analysis

14. A Competitive Conjecture Process
First period
Our
total
outcome
Second period
Should we cut price?

15. Ch. 6
CUSTOMER ANALYSIS
15

16. What we need to know about customers
and their roles?
• Who buys and uses the product
• What customers buy and how they use it
• Where customers buy
• When customers buy
• How customers choose
• Why they prefer a product
• How they respond to marketing programs
• Will they buy it (again)
16

17. Who Buys and Uses the Products?
• Initiator -who identifies the need for product
• Influencer -who has informational or
preference input to the decision
• Decider –who makes the final decision
through budget authorization
• Purchaser –who makes the actual purchase
• User
17

18. Buying Roles and Needs/Benefits Sought
• Needs/benefits sought by eachactor involved
• Assessing value:
– Determine the uses of the product
– Estimate the importance of the uses
– List competing products for the uses
– Determine the relative effectiveness of the product category in each usage
situation
18

19. Categories for Describing Consumers
1. Demographic
2. Socioeconomic
3. Personality
4. Psychographics and values

20. Gambero Rosso: the core target
description (demo and socio variables)
THE MAIN TARGET FOR GAMBERO ROSSO: “FOODIES”
Foodies constitute 9.8% of Italy’s population between the ages of 15
and 74, or about 4.5 million people. Only two years ago, they
comprised 8.6% and the number is growing by 250,000 each
year.
Foodies are mainly males aged between 25 and 54 living in
northern Italy (27.8%) with medium to high income and a
secondary education. 53% are couples with children but
concentration is above average among singles and couples
without children.
Giuseppe Pedeliento - May
25-26, 2011
20

21. Gambero Rosso: the core target
description (psychographics)
Foodies are strongly interested in eating out and in the quality of
food and wine. For Foodies food is a multisensorial experience.
Foodies care about quality, shun excess and care about fitness.
They are inclined to experiment, adore internet, read books and
cookery magazines and watch food programs on TV. Foodies are
less traditionalist at table. They regard eating as “one of life’s
most important pleasures”. Knowledge – and its subsequent
application – is foodies’ chosen strategy to play an influential
role in this context.
Giuseppe Pedeliento - May
25-26, 2011
21

22. Gambero Rosso: the core target
description (psychographics) cont.
INTERNET, THE FOODIES’ MEDIUM OF CHOICE
Seven foodies in ten (against just 33.2% of non-foodies) are
frequent users of internet to visit/consult sites dedicated to food.
Foodies use the web to look mainly for “information” (58.5%) and
recipes (54.3%) but also check out restaurants and other eateries
(43.5%). 11.3% of foodies contribute to food or cookery-related
blogs and discussion groups.
The foodies’ favorite restaurant guide is Gambero Rosso (52%),
followed by the evergreen Michelin (45.3%), l’Espresso (37.1%)
and Touring Club (36.9%) guides.
Giuseppe Pedeliento - May
25-26, 2011
22

23. Nielsen’s cultural/tech segmentation
Culture (+)
Sophisticated Eclectics
13% 14%
Traditionalist
24%s
Traditional Technological
matrix vanguard Tecnology (+)
Tecnology (-)
Technofan
TV People 18%
31%
Culture (-)
Giuseppe Pedeliento - May
25-26, 2011
23
23

24. Major Segmentation Variables
for Business Markets
• Demographic
(e.g. industry, company size, location)
• Operating variables
(e.g. technology, user/non user status, customer capabilities)
• Purchasing approaches
(e.g. purchasing processes and criteria, nature of existing relationships)
• Situational factors
(e.g. urgency, size of orders)
• Personal characteristics
(e.g. buyer seller similarity, loyalty)

25. What customers buy and how they use it
• Focus on benefits
• Purchase patterns (Does the customer
has recently bought from you? Does
he/she buy frequently? Does he/she is
an high or a low value customer?)
• Utilitarian vs hedonic consumption
25

26. What customers buy? A “special case”
26

27. Where customers buy
• Large retailers
• Small retailers
• Flagship stores
• On line
• ….
27

28. The importance of the web in car’s purchasing
decision
Internet Perceived
usage importance
Search for informations
67% 75%
Brands’
61% comparison 70%
Purchasing
28% 57%
decision
Choice
35% 51%
of the
reseller
Source: TNS – Google (2007)
On line purchasing= 0%
28

29. How customers choose – The Multiattribute
Model
1. Which attributes do customers use to
define a product?
2. How do customers determine how much of
each attribute a brand possesses?
3. How are the importance weights
determined?
4. What decision rule is used to combine the
information?
29

30. How truck drivers define competing
products/brands
Source: Gambero Rosso’s customers panel
Source: SdM Research Project
30

31. Gambero Rosso: sources of brand value
Source: Gambero Rosso’s customers panel
31

32. Why they prefer a product
• Economic:
– The economic benefit a customer derives from using
a product
• Functional:
– Those aspects of a product that provide functional or
utilitarian benefits to customers
• Psychological:
– The image of the product, including how the product
“feels” and whether that feeling matches the image
the customer wants to project

33. Manifestations of Customer Value
• Price sensitivity
• Satisfaction
• Complaints and compliments
• Word-of-mouth
• Margin/profit contribution
• Repeat purchase rate
• …..

34. Assessing the Value of the Product
Category
1. Determine the uses of the product
2. Estimate the importance of the uses
3. List competing products for the uses
4. Determine the relative effectiveness of the product
category in each usage situation

35. Desirable Criteria for Segments
• Sizeable
• Identifiable
• Reachable
• Respond differently
• Coherent
• Stable

36. Gaining customer and market insight
through business intelligence
Product and Brand Management (23C630)
Ch. 5 & Ch. 6
September, 12th
Giuseppe Pedeliento, University of Bergamo (Italy)
Visiting Aalto University School of Economics,
Department of Marketing