Class 3

Sales & Marketing

NBC1 2008, (c) 2008Jay A. Smith 1

Todays Drucker
The purpose of a business is to create and keep a customer.

NBC1 2008, (c) 2008Jay A. Smith

Sales & Marketing

Product/Service COMPANY Customers Money

Sales (Revenue):
Money

received for selling product or service Source of funds for business operations Basis for business existence

Marketing: how company gets sales

selection, pricing, promotion and distribution of products/services to customers
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NBC1 2008, (c) 2008Jay A. Smith

Marketing and 4 Cs & 2 Ss

Competitors

Suppliers

___ Company

Channel

Customers

Substitutes

Collaborators th / 5 C
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Customers

Who are your customers (or target customers)? How many potential customers are there? What are their characteristics?

Age, sex, wealth, education, hobbies, work, is it one person? What are their goals, desires, needs, wants? What do they think about? Where do they get information? Who influences them? What is important to decide (price, features) When do they buy (seasonal products, bonus season) When do they pay? Broad market = U.S. Market, Software Market Narrow market segment = left-handed golfers
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How do they buy?

Market segment = group of similar customers

NBC1 2008, (c) 2008Jay A. Smith

Marketing Universe

Product/Service (what) Market (where, who)

Location (U.S.,Japan, ) Gender (male, female) Age (<21, 21-35, >70, ) Activity (ski, golf, travel) Preference ( New application for a keitai New application for a tree

Application (how, why)

NBC1 2008, (c) 2008Jay A. Smith

Example Consumer Market Automobiles Segmentation & Positioning

Jaguar In Pink Jaguar Mazda Volvo Ford Toyota

Takako Tanaka
Wealthy, Single, Women

Classy

Zoom

Safe

American

Car

Single Women
Wealthy, Single, Men

O
O

O O O O

Single Men Younger Families Older Families Older Drivers

NBC1 2008, (c) 2008Jay A. Smith

O O O O O O O O O O

Business Market Segmentation

How Many Microsoft
Fortune 500

1 500 ~ 10-20,000

Large Businesses Medium Businesses Small Businesses >1 person 1-person companies
NBC1 2008, (c) 2008Jay A. Smith

9 million

All U.S. Businesses

10 million total

Consumer & Business Markets

Haagen-Dazs Nike Microsoft Dell HP GE Sony Hair Salon Amazon Askul

Product

Uniqlo Starbucks

Intel

Bloomberg

Service

eBay Secom

Consumer Market
NBC1 2008, (c) 2008Jay A. Smith

Business/Industrial Market
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3rd Party Business Model

Product/Service

COMPANY
Money

Customers

Product/Service

COMPANY

User

Money

Other Service
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Sponsor
NBC1 2008, (c) 2008Jay A. Smith

Sales/Buying Cycle
Awareness => Interest => Trial =>Purchase => Repurchase Hear About This Exists Curious Educate Try Test Buy Use it Keep Using KeepBuying

Repeat customers are key to business success

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Industry/Market Life-Cycle
SALES

Awareness Interest Trial Purchase Repurchase

Emerging
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Growing TIME

Maturing

Declining
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Technology Adoption Life Cycle

Financial Services Academics Tech. Fans Innovators Early Adopters

Main Market

Early Majority Time

Late Majority

Laggards

Examples- Internet
NBC1 2008, (c) 2008Jay A. Smith

Geoffrey Moore, Crossing the Chasm

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4Ps Marketing Mix

Product (what do we make) Place (where do we sell it) Price (how much we sell it for) Promotion (how we communicate about it)

NBC1 2008, (c) 2008Jay A. Smith

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Product

What is our product and/or service

Physical/tangible alarm, software, newspaper, coffee Intangible security, insurance, information, experience What does it do? How is it used?

Why do people buy it

Does it need something else? One-time or consumable?

Packaging (box, label, information, customer experience) Positioning

How different is it (perceived) from other products? What is my brand image/strength

NBC1 2008, (c) 2008Jay A. Smith

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Place Where do I sell?

Choosing the Channel, Supporting It How many potential customers are there? Can I easily identify customer? How expensive is my product? How many products can I sell one customer? How powerful, or valuable are the resellers? Are there many resellers that compete?
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NBC1 2008, (c) 2008Jay A. Smith

Price Issues

What does it cost to produce? (floor)

Cars,

Soda, Computers Pharmaceuticals, Software

How much value does it have to customer? (ceiling) How many can I sell at each price?
How

many customers are there? How much competition is there? Is it easy to compare with other prices? How much better is my product?

Does price fit with my positioning?

NBC1 2008, (c) 2008Jay A. Smith

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Price & Margin

Price to customer

Price to Channel

Cost

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Promotion

NBC1 2008, (c) 2008Jay A. Smith

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Promotion (communications, selling)

Advertising

Push (direct mail, email)

Is each customer readily identifiable? Cant readily identify individual customers

Pull (TV, radio, poster, newspaper, some banner ad)

Internet can be push or pull Chirashi?

Public Relations Investor Relations Intel Case Examples

Motorola: 13 Wall Street Journal Ads Intel: 6% rebate = 4% up to 66% of Print, 2% up to 50% of TV/radio

NBC1 2008, (c) 2008Jay A. Smith

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Visual Aids

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Humor in Advertising

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Packaging Functionality

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Product Positioning Promotion

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Promotion & Market Segmentation

Promotion Media Taro Tanaka Overweight, Athletic, Beer-Drinking Men, Who care about their figure Direct Mail Fitness Magazine

Overweight, Athletic, Beer-Drinking Men Overweight Athletic Men Overweight Men Men People
NBC1 2008, (c) 2008Jay A. Smith

Targeted Poster Football Broadcast Train Poster Night TV TV

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1 Women, buy ALL the stuff

Women buy or influence the purchase of nearly all consumer products and an increasingly high percentage of business related products

1 Tom Peters, author of In Search of Excellence

NBC1 2008, (c) 2008Jay A. Smith 26

Next Class 5 27

Regional Goods Marketing Project Presentation

NBC1 2008, (c) 2008Jay A. Smith

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Region Marketing Project

Group project 1-2 people Pick product/service from Kagoshima or home region/country Pick a target market Develop company sales/marketing/branding promotion 5/ 27 presentation (powerpoint, poster, or other)
Presentation:

5 Q&A and advice: 2-5 English Preferred

NBC1 2008, (c) 2008Jay A. Smith

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Famous Country Products

Mercedes Benz, BMW Fendi, Versace Victorinox Rolex, Omega Seiko, Casio Elvis Presley Gekkeikan, Kikkoman Glenlivet, Chivas Regal Jack Daniels Jamieson

German Car Italian Clothing Swiss Knife Swiss Watch Japanese Watch American Rock & Roll Japanese Sake, Soy Sauce Scotch Whisky Tennessee Whiskey Irish Whiskey
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NBC1 2008, (c) 2008Jay A. Smith

Guinness = Ireland = Genius?

+ Alcohol as Product

Easy to label, package Niche-ability Easy trial Consumable Addictive Social pressure Advertising Costs Channel Strength Social pressure

159 36.5 per year

Challenges

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Region Goods/Service Promotion Project

Product/service: Company/brand: Customer target & size: Promotion message: Place: Channel: Competition: Price: Collaborators:

+ ADVERTISEMENT Sample

NBC1 2008, (c) 2008Jay A. Smith

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Promotion Project

Product/service: Company/brand: Customer target/size: Promotion message: Place: Channel: Competition: Price: Collaborators:

Kagoshima fresh tonkatsu Big Pig Ka-ton Japanese tourist hotels (200?) Japans juiciest tonkatsu Trade fair, magazine, site visits Direct (sales force) Kumamoto Ton, Nissin Slight premium Kagoshima pig farmers

NBC1 2008, (c) 2008Jay A. Smith

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TM

So Fresh You Think It Can Fly

NBC1 2008, (c) 2008Jay A. Smith

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Fit Is this the Right Match?

Opportunity Environment (4Cs) Marketing Mix (4Ps) Selling/Buying Cycle (Goal) Promotion Message & Strategy Business Model

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NBC1 2008, (c) 2008Jay A. Smith

Suggested Readings

Books

by E. by E. , by by by by

Video

with with Glengarry Glen Ross with

WWW

Entrepreneur.com

NBC1 2008, (c) 2008Jay A. Smith

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Class 4:
Marketing Presentations

NBC1 2008, (c) 2008Jay A. Smith

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Region Goods/Service Promotion Project

Product/service: Company/brand: Customer target & size: Promotion message: Place: Channel: Competition: Price: Collaborators:

+ ADVERTISEMENT Sample

NBC1 2008, (c) 2008Jay A. Smith

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Fit Is this the Right Match?

Opportunity Environment (4Cs) Marketing Mix (4Ps) Selling/Buying Cycle (Goal) Promotion Message & Strategy Business Model

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NBC1 2008, (c) 2008Jay A. Smith

Stealing a Countrys Product

Emphasize the Difference, Dont Hide It!

NBC1 2008, (c) 2008Jay A. Smith

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Advertisement Discussion
Product/Service Target Market Medium Value Proposition Message Buying Cycle

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NBC1 2008, (c) 2008Jay A. Smith

Product vs. Brand

Product Made at factory Can be copied Quickly becomes old

Brand Purchased by Customer Unique Timeless

Stephen King, WPP London

NBC1 2008, (c) 2008Jay A. Smith 41

Homework: Dell Online Case

Issues to Think About
Company History and Choices Industry & Competition Products Customer/Market Segments Pricing Channel/Operations Competitive Advantage Case questions & decisions

NBC1 2008, (c) 2008Jay A. Smith

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