Transcript The Pan Paradigm of Business Analysis

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The mirror image:
 Business offerings ≥ Market receipts in value assessment
relative to individuals’ need, want, and demand
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The transaction process:
 Something must be exchanged between parties at two
sides for profitability to stay in business
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Business Offerings
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Product
Ideas
Organizations
Persons
Destination/location
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Market
 Consumer
 Industrial/Business
 Financial
 Commodities
 Technology
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Product
 Goods
 Services
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Market
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Demographic
Psychographic
Behavioral
Socio-Economic Status
Combined groupings
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Product (design+engineering)
 Branding
 Functions
 Process-how to
 Properties
 Attributes
 Features
 Utilitarian functions
 Line
 Mix
 Width
 Length
 Depth
 Life cycle
 Intro-growth-maturitydecline
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Human
 Brand Identification
 Brand equity formation
 Brand status association
 Benefits
 Need
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Biological
Psychological
Social
Personal developmental
 Want in form of
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Family
Traditional heritage
Cultural conformance
Personal determinants
 Demand
 Aggregated wants supported
by purchasing power
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Brand Evaluation
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HI (M)
O(M)
F(A)
C(A)
L(E)
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Market Development
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 (Preferred)
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 Hi, mom, fa-ca-le with
 Elleii
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Brand Evaluation
 Host v. Member
 How the host brand incubates
member brands?
 Origin v. Manufacturing
 How the brand origin interacts
with effect of country/place of
manufacturing?
 Focal Brand v. Brand Allies
 How a brand(s) can shadow or
augment the brand in focus of
evaluations?
 Chief v. Associated Brands
 How strong the association can
be?
 Locus Brand Core v. Brand
Extensions
 How far it can go on a sliding
scale of effect and control?
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Hi, mom, fa-ca-le with
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Market Development
 Existing
 Loyal
 Those who are committed
 Preferred
 Those who preferred yours over
competing one but with a “catch”
 Leisure
 Those who browse around
without a brand preference
 Extended(prospective)
 Informed
 Those who have been exposed or
informed with the brand at issue
 Innocent
 Those who have never been
exposed with a particular brand at
issues
Elleii
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Combined Strategies
from Decisions of
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Product
Price
Promotion (IMC)
Place (Distribution)
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Target at Classic
Segmentation by:
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Demographic
Psychographic
Behavioral
SES, etc
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To position
 A product distinguishable
in the mind of intended
market (customers and
consumers) relative to its
quality in the price-value
assessment
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To achieve
 Loyal consumers
through stages from their
innocence
Price = TC + “ME”
Unit
TC: total cost = VC + FC
ME : marketing effort
including branding,
promotions, etc
Unit: quantity of product
Value = Q + “BE”
Unit
Q: quality - real + perceived
relative to many such real
self, ideal self, etc
BE: Brand Equity
Unit: quantity of product
Business side
Price
Utilities
Form
Time
Place
Ownership
Market side
=
Value
Benefits
Need
Want
Demand
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Product decisions
Price decisions
Promotion decisions
Place decisions
Business strategies
Product- anything a consumer acquires or might acquire to
meet an emerged need.
*The term Need is depicted as a state of disequilibrium between the
actual and desired self. i.e., Necessities, wants, and desires.
This includes:
 Attributes-main or core qualities of product.
 Features- additional, distinct aspects of product.
 Utilitarian Functions- practical, useful, and functional
properties of product.
The product branding process
The product branding consideration
The product engineering process
The product positioning
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Brand Engineering should include
• Differentiation against competitors
• Fit with desired human personality traits
• Possession with strong associations
• Arousal of stimulating emotions
• Creation of Brand Equity-value beyond the
real value of product
• Visualization of desired Brand Image
• Fanciful or Arbitrary
• Aspirin
• Coke
• Google
• Yumlings
• Suggestive
• Yumlings
• Fish-Fri v. Chick-Fri
• Descriptive
• Chicken Soup
• ….
• Generic
 Aspirin
 Coke
 Google ≠ Yahoo
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The “Swinging Clock Pendulum” rule without
trademark registration
The auto protection with trademark registration
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Achieve tangible differentiation against
competitors
Achieve excellence in quality (real/actual and
perceived
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Google
 30% of Chinese market share (11.2%?)
 $90 m/$200m in sales in 2008 (google.cn/CHN) in
comparison of $22 billion worldwide
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60-60% of Chinese market share
$381 m in sales in 2008 and two digits of
percentage increase in 2009 by quarter reports
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“Grain’s Song” in Chinese name
The name "Google" originated from a
misspelling of the word "googol“ in English which
refers to 10100, the number represented by a 1
followed by one hundred zeros, reflective of the
product itself
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Many people have asked about the meaning of Baidu in English
for Chinese.
'Baidu' was inspired by a poem written more than 800 years ago
during the Song Dynasty. The poem compared the search for a
retreating beauty amid chaotic glamour with the search for
one's dream while confronted by life's many obstacles.
'...hundreds and thousands of times, for her I searched in chaos,
suddenly, I turned by chance, to where the lights were waning,
and there she stood.' (Chinese: 众里寻他千百度，蓦然回首，
那人却在灯火阑珊处;)
Baidu, whose literal meaning is hundreds of times, represents
persistent search for the ideal.
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Product
 Every element of a claim
 Is literally infringed, or
 Is infringed under the doctrine of equivalents
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Trademark
 Likelihood of consumer confusion
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Strength of mark
Proximity of the goods
Similarity of the marks
Evidence of actual confusion
Marketing channel used
Types of goods and purchaser care
Intent
Likelihood of expansion
 Dilution
 Kodak bicycles, or Buick Aspirin , ..
Price- the amount of money one must pay to obtain
the right to use the product.
Price should be determined by the following factors:
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Fixed and variable costs
Competition
Company objectives
Proposed positioning strategies
Target group and willingness to pay
Based on the company’s objectives.
Examples include:
 Penetrating Pricing
 Bundle Pricing
 Skimming Pricing
 Psychological Pricing
 Competition Pricing
 Premium Pricing
 Optional Pricing
Promotion- the communication of information of a product to
generate a positive consumer response (sales).
Decisions concerning promotions include:
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Promotional strategy (push, pull, etc.)
Advertising
Personal selling & sales force
Sales promotions
Public relations & publicity
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Marketing communications budget
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Place (Distribution)- is having the product available
where target customers can buy it.
Some examples of distribution decisions include:
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Distribution channels
Market coverage (inclusive, selective, or exclusive
distribution)
Specific channel members
Inventory management
Warehousing
Distribution centers
Order processing
Transportation
Reverse logistics
Backward and Forward Integration
Targeting a market involves research to determine the
changing trends of consumer behavior.
This is done through researching:
Demographics
Psychological Aspects
Behavioral Aspects
Socio-economic Status
By ELLEII
Demographics- selected population characteristics.
Examples: location, race, age income, education,
occupation, etc.
Demographics determine certain cultural factors
that will affect not only consumer behavior but also
the marketing strategy of a company.
Psychological Aspects-studies the mind and behavior of
individuals. Refers to the mental and behavioral constitution
of a person.
By researching a target market’s different perceptions, thoughts,
values, and beliefs a better understanding of what the
marketing strategy must accommodate with is revealed.
This area of aspects can also reveal where to position a product
for the greatest success.
Behavioral Aspects- refer to how a person conducts his or
herself in specific situations for observable conduct only,
such as frequency of purchase or usage under the effect
of a given stimuli or situation.
This is pertinent to developing a solid marketing strategy.
Such factors can be pinpointed as:
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Celebrity Endorsers
Brand personality
Emotions
Imagery
Socio-economic status- divides population into
classes according to income, occupation,
education, and ethnic background.
Example of scales: Lower-middle, Middle, Upper-Middle, and Upper
levels.
This determines the appropriate location, pricing, and themes
that will be successful in marketing a product to its niche.
There are four stages through which persons in a target
market have to be developed into a business market
share.
They are as follows:
ELLII – Preferred between L and L
 Individuals that must have no
knowledge of a brand coming to a
marketplace
 Individuals that must be made aware of
the brand to purchase for the first time.
Those who may or may not recognize
the brand and make non-committal or
non-habitual purchases
Those who prefer the brand over other
competing ones and will purchase it
continually unless competitor product
has a distinguishable advantage such as
special price discount, new feature, or
the preferred one is currently out of
stock.
Those who are brand loyal and will
purchase ONLY that brand, even if brand
is out of stock.
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The relationships between need, want, and
demand
How does a need “emerge”
Where does a need come from?
Is need or want a universal?
Can we do business for a demand without
affordability?
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an emerged state of disequilibrium from what
has been maintained as a homeostasis in
humans; or a result of being out of the Zone
of Comfort in humans, it comes from in the
fields of biological, psychological, social, and
economic perspective, etc.
Desire - a feeling that accompanies an
unsatisfied state. A wish, craving, or lust.
– a form of need taken in the desirable feeling
that is determined by individual preference
shaped by how one has been “formulated”
from his or her development, family, cultural,
ethnic, peer influences, or personal limitations.
the aggregated want or desire to possess a
good or service with purchasing power
(money or affordability) necessary to make a
legal transaction for the good or service.
The demand curve displays the relationship between the price of the
product and the amount of product consumers want to buy. This
relationship is indirect because as prices go up, people buy less of that
particular product. It is referred to as the Law of Demand.
During times of recession and
depression, the demand of
products in general declines;
however it is the “wants” that
can be suppressed or delayed
far more than the “needs” that
could have emerged
The relationship of
Demand/Need/Want should be
“mirrored” the relationship of
the product’s attributes,
features, and utilitarian
features from the Business side.
On the business side, price can be determined
by: Total Cost/Quantity plus “marketing
effort.” This will present a minimum dollar
value to the market side because price will
never be less that the expenses accrued from
producing a product unless other economic or
strategic considerations are factored.
On the market side, value can be determined by Quality plus
Brand Equity. Quality can be viewed and verified through
usage in the form of real or perceived one in this equation.
This relationship can be depicted
by use of the product positioning
method.
Product positioning- an image of
the product or brand in the
consumer’s mind relative to
competing products and brands.
Through the use of a perceptual map, brands can position
themselves in a market with competitors to form their own
niche of the market and create a successful brand or product.
Using the perceptual map below, the market responses of the Quadrants
1-4 will be determined: Quadrant 1 represents high-priced, low quality
products, therefore, labeled as Market Rejection. The consumer choice to
purchase in this category is unlikely to have repeat purchases once the
lack of quality is revealed. “The best marketing will sell it for once only.”
Q3
Q2
Q4
Q1
Quadrant 2 represent low quality, low-priced products that are most
affordable for the general population. The consumer choice for this
category will be significantly higher than Quadrant 1 because of the
affordability, especially in times of recession. Therefore, labeled as
Market Choices or Market Selection. (Leisure in ELLEII)
Q3
Q2
Q4
Q1
Quadrant 3 represents low-priced, high quality products. This Quadrant
should command the highest market share because of product’s high
quality and low price. Therefore, labeled as Market Acceptance or
“Consumers’ Dream.” Consumers in Q2 will most likely to purchase those
in Q3 once the product’s info in known. Remember ELLEII w Preferred?
Q3
Q2
Q4
Q1
Quadrant 4 represents the most exclusive product category with high
quality and high price. Q4 serves those few with affordability and want to
be uniquely different from the commons, and those are “aspirational” to be
those few (through living beyond real self in a hope to elevate “status” to
be that). Ordinary people do also consider such when facing bit ticket
items such as cars, houses, watches, shows, dresses, etc. The market
share is limited but could be “puffed” when certain conditions are met.
Q3
Q2
Q4
Q1
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The Pan’s Paradigm has presented you with the
scope and elements of Marketing in general
These are on the start line of how to study Marketing
Principles, Consumer Behavior, Promotion, Pricing
Strategies, Marketing Research, Sales/Sales
Management, or International Marketing.
Please keep this model as we have to navigate often
by using the pathways of this “forest” of this
business model, minus those in management,
accounting, finance, MIS, or strategic perspectives in
the field.