Business Marketing Management in a Business-to-Business Context 9781774695708, 9781774694237

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Business Marketing Management in a Business-to-Business Context

本书版权归Arcler所有

本书版权归Arcler所有

本书版权归Arcler所有

BUSINESS MARKETING MANAGEMENT IN A BUSINESSTO-BUSINESS CONTEXT

D.P. Warne

Publishing

www.societypublishing.com

Business Marketing Management in a Business-to-Business Context D.P. Warne

Society Publishing 224 Shoreacres Road Burlington, ON L7L 2H2 Canada www.societypublishing.com Email: [email protected]

e-book Edition 2023 ISBN: 978-1-77469-570-8 (e-book)

This book contains information obtained from highly regarded resources. Reprinted material sources are indicated and copyright remains with the original owners. Copyright for images and other graphics remains with the original owners as indicated. A Wide variety of references are listed. Reasonable efforts have been made to publish reliable data. Authors or Editors or Publishers are not responsible for the accuracy of the information in the published chapters or consequences of their use. The publisher assumes no responsibility for any damage or grievance to the persons or property arising out of the use of any materials, instructions, methods or thoughts in the book. The authors or editors and the publisher have attempted to trace the copyright holders of all material reproduced in this publication and apologize to copyright holders if permission has not been obtained. If any copyright holder has not been acknowledged, please write to us so we may rectify. Notice: Registered trademark of products or corporate names are used only for explanation and identification without intent of infringement.

© 2023 Society Publishing ISBN: 978-1-77469-423-7 (Hardcover)

Society Publishing publishes wide variety of books and eBooks. For more information about Society Publishing and its products, visit our website at www.societypublishing.com.

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ABOUT THE AUTHOR

D.P. Warne is currently senior professor and Dean, Faculty of Commerce and Management, Chaudhary Devi Lal University, Sirsa. He did his Master’s program from Guru Nanak Dev University and PhD from Punjab Agricultural University, Ludhiana. He started his career as an officer at Duke Fabrics. His love for teaching however, made him to resign this position. Presently, he is university proctor, Dean (International Relations), Director (consultancy cell), University Librarian, Member (Executive Council) and Member (Academic Council). He has served for more than 10 years as head of department and Dean, Faculty. He is a memeber of many acadmic and professional bodies. He has teaching, research and industrial experience of 30 years. He has published seventy papers in national and international journals of repute and also has participated in seminars, workshops and conferences.

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TABLE OF CONTENTS

List of Figures ..............................................................................................xiii List of Abbreviations ...................................................................................xvii Abstract ...................................................................................................... xix Preface.................................................................................................... ....xxi Chapter 1

Managing the Marketing Process and Marketing Planning ........................ 1 1.1. Research and Selection of Target Market ............................................. 2 1.2. Analyzing Marketing Opportunities .................................................... 5 1.3. Types of Analysis to Identify Market Opportunities .............................. 6 1.4. Developing Marketing Strategies ....................................................... 11 1.5. B2B Email Marketing ........................................................................ 12 1.6. Best Practices for B2B Email Marketing ............................................. 12 1.7. B2B Digital Marketing ...................................................................... 13 1.8. B2B Content Marketing..................................................................... 14 1.9. B2B Social Media Marketing............................................................. 15 1.10. Planning, Implementation, and Control of Marketing Plans (Marketing Mix).............................................................................. 16 1.11. Alternative Marketing Mixes ........................................................... 19 1.12. Emerging Trends in Business Marketing Management...................... 22 1.13. The Buyer’s Journey......................................................................... 23 1.14. Phases of the Buyer Journey ............................................................ 23 1.15. Buyer’s Journey Mapping ................................................................ 25

Chapter 2

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Marketing Information Systems and Marketing Research ........................ 29 2.1. Introduction ...................................................................................... 30 2.2. Proficiency in the Business of Advertising and Marketing .................. 31 2.3. Components of a Marketing Database’s Operating System ................ 32 2.4. Gathering, Storing, Analyzing, and Distributing Valuable Marketing Data ............................................. 35

2.5. Market Segmentation and Targeting .................................................. 39 2.6. Targeting and Segmentation of Markets ............................................. 42 2.7. Relationship Marketing ..................................................................... 43 2.8. Brand Management .......................................................................... 49 2.9. Customers Alone Aren’t the Only Ones Affected By a Brand’s Management ...................................................................... 51 Chapter 3

Developing Testing and Launching New Products and Services .............. 53 3.1. Seven Stages in the New Product Development Process ................... 54 3.2. Importance of Strategic Product Launching ....................................... 63 3.3. How to Develop SMART Goals? ....................................................... 66 3.4. The Advantages of a New Product Launch ........................................ 68

Chapter 4

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Managing Products through Their Product Life Cycle ............................. 77 4.1. A Clear Explanation of Product Lifecycle Management (PLM) ........... 78 4.2. The Benefits of Product Lifecycle Management ................................. 79 4.3. A Brief History of Product Lifecycle Management (PLM) ................... 79 4.4. Product Life Cycle Stages .................................................................. 81 4.5. Stages of the Product Life Cycle ........................................................ 82 4.6. Product Life Cycle Scenarios............................................................. 86 4.7. A System of Artificial Intelligence (AI) ............................................... 88 4.8. Use of the Product’s Entire Life Cycle ................................................ 89 4.9. Product Lifecycle Influences ............................................................. 90 4.10. Advances in Technology.................................................................. 91 4.11. Money’s Forces ............................................................................... 91 4.12. Conducting Market Research to Assist With a Product Launch ........ 92 4.13. Market Development ...................................................................... 94 4.14. Market Introduction ........................................................................ 96 4.15. Difficulties in the Initial Phase ........................................................ 96 4.16. Product Lifecycle Administration .................................................... 97 4.17. The Factors Influencing Market Growth ........................................... 99 4.18. Maturity ........................................................................................ 100 4.19. Positive Qualities of the Mature Stage ........................................... 101 4.20. Market Decline ............................................................................. 102

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4.21. Product Lifecycle Administration .................................................. 103 4.22. Importance of the Product Life Cycle ............................................ 103 Chapter 5

Designing Pricing Strategies and Programs ........................................... 107 5.1. Five Levels of Strategic Pricing ........................................................ 110 5.2. Retainer Pricing .............................................................................. 112 5.3. The Advantages and Disadvantages of Retainer Payments ................ 115 5.4. Implementing Retainer Pricing in Seven Simple Steps ..................... 116 5.5. Value-Based Pricing ........................................................................ 120 5.6. Cost-Plus Pricing vs. Value-Based Pricing ........................................ 122 5.7. Package Pricing............................................................................... 123 5.8. Increasing the Value of Bundled Products May Result in Reduced Sales ......................................... 125 5.9. Bundled Pricing vs. Tied Selling ...................................................... 127 5.10. How to Describe a Bundle Pricing Strategy ................................... 128 5.11. How to Combine Prices ................................................................ 129

Chapter 6

Managing Retailing and Wholesaling .................................................... 131 6.1. Introduction .................................................................................... 132 6.2. Deciding on Company’s Market Value Proposition .......................... 135 6.3. Selecting the Best Channel Design for Retailing and Wholesaling ... 142 6.4. Factors to Consider While Selecting a Channel of Distribution ........ 145 6.5. Nature and Size of the Manufacturing Unit ..................................... 149 6.6. Benefits of a Good Channel Design ................................................ 150 6.7. Challenges Facing a Channel Design .............................................. 151 6.8. Logistics Management .................................................................... 152 6.9. Benefits of Logistic Management..................................................... 154 6.10. Challenges of Logistic Management .............................................. 155

Chapter 7

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Designing Communication and Promotion-Mix Strategies .................... 157 7.1. Strategies of the Promotional Mix ................................................... 158 7.2. What Is the Intention of Your Marketing Mix? .................................. 160 7.3. Your Promotional Combination ....................................................... 160 7.4. Analytic Thinking ............................................................................ 163 7.5. Advertising...................................................................................... 166 7.6. Public Relations .............................................................................. 169

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7.7. Sales Promotions ............................................................................ 171 7.8. The Benefits of Using a Marketing Strategy ...................................... 172 7.9. Direct Marketing............................................................................. 173 7.10. Achievement of the Planned Objective ......................................... 174 7.11. Evaluate the Program’s Efficacy and Make Any Necessary Changes ...................................................................... 177 7.12. The Four Ps of Marketing............................................................... 178 Chapter 8

Implementing Marketing Programs ....................................................... 183 8.1. Who Are The Client Personas Aimed at By Your Marketing Campaigns?.................................................................................. 185 8.2. The Advantages of an Effective Marketing Implementation Strategy . 186 8.3. Setting Realistic Expectations for Marketing Strategies..................... 186 8.4. Setting Objectives and Implementing Five Different Digital Marketing Strategies ..................................................................... 187 8.5. Social Media Marketing .................................................................. 188 8.6. Emailing Prospective Customers ..................................................... 189 8.7. Review of the Marketing Plan ......................................................... 190 8.8. Examine Your Marketing Strategy .................................................... 191 8.9. Identification of Resources .............................................................. 194 8.10. Getting Project Planning Software................................................. 196 8.11. Documentation of the Marketing Strategies................................... 197 8.12. Establish Content Objectives for Each Phase ................................. 198 8.13. Plan the Amplification Channels ................................................... 199 8.14. Create a Publication Schedule ...................................................... 200 8.15. The Benefits of a Documented Market Strategy ............................. 200 8.16. Creating Workflow ........................................................................ 201 8.17. Method for Creating Workflows .................................................... 201 8.18. Managing Marketing Project ......................................................... 205 8.19. Measuring Results ......................................................................... 208

Chapter 9

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Controlling Market Activities ................................................................ 213 9.1. Market Control Techniques ............................................................. 216 9.2. Behavioral Analysis (Customer Buying Criteria) ............................... 218 9.3. Behavioral Analysis (Purchase Process and Patterns)........................ 220 9.4. Customer Demographics ................................................................ 221 9.5. Testing Research.............................................................................. 222

9.6. Controlled Experimentation ............................................................ 223 9.7. Observational Studies ..................................................................... 224 9.8. Correlation/Causation ..................................................................... 225 9.9. Non-Experimental Designs ............................................................. 225 9.10. Survey .......................................................................................... 226 9.11. Case Study/Casuistry ..................................................................... 226 9.12. Qualitative Analysis ...................................................................... 227 9.13. Customer Feedback ...................................................................... 228 9.14. Complaints ................................................................................... 230 9.15. Types of Marketing Control ........................................................... 232 9.16. Management by Objectives; the Heart of Annual Plan Control...... 233 Chapter 10 Multidimensional Scaling ...................................................................... 239

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10.1. What Precisely is Multidimensional Scaling?................................. 240 10.2. MDS Incorporation ....................................................................... 240 10.3. Genus and Subtypes ..................................................................... 243 10.4. Multidimensional Scaling vs. Factor Analysis ................................ 244 10.5. Trends in MDS .............................................................................. 246 10.6. Multidimensional Scaling in Business ........................................... 251 10.7. Application of Multidimensional Scaling in Market Research ........ 253 10.8. Facts and Figures about Multiple Sclerosis .................................... 254 10.9. The Performance of Multidimensional Scaling............................... 254 10.10. Choosing the Number of Dimensions to Include......................... 256 10.11. Assessing MDS’s Dependability and Correctness ......................... 256 10.12. The Purpose of Multidimensional Scaling.................................... 257 10.13. Multidimensional Scaling Applications ....................................... 258 10.14. Characteristics of Multidimensional Scaling ................................ 260 Bibliography .......................................................................................... 265 Index ..................................................................................................... 271

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LIST OF FIGURES

Figure 1.1: Market segmentation on consumption across communication classes Figure 1.2: Process of selecting target markets Figure 1.3: Market opportunity analysis Figure 1.4: Customer segmentation can be determined by factors like demography, geography and behavior Figure 1.5: Social media is a vital marketing strategy in the modern age Figure 1.6: Businesses are communicating more frequently on social media Figure 1.7: Employees discussing a strategic annual plan Figure 1.8: The process of customer journey mapping Figure 2.1: The management information system (MIS) Figure 2.2: Components of a marketing database’s operating system Figure 2.3: Valuable marketing data Figure 2.4: Gathering data Figure 2.5: Market segmentation Figure 2.6: Market segmentation Figure 2.7: Relationship marketing Figure 2.8: Brand management Figure 3.1: Infographic template Figure 3.2: Company homepage template Figure 3.3: Product release illustration Figure 3.4: Startup and development of a product Figure 3.5: Research illustration Figure 3.6: Startup banner Figure 3.7: Brand name abstract Figure 3.8: Flat line design Figure 3.9: Flat poster motivating Figure 3.10: Business agreement launch Figure 4.1: A blackboard written product life cycle

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Figure 4.2: An infographic on a product and its processes Figure 4.3: A graph of sales volume against the product life cycle Figure 4.4: Factors affecting product life cycle Figure 4.5: A graph of money this to time Figure 4.6: An infographic showing the product lifecycle management Figure 4.7: A graph of sales against time Figure 4.8: A representation of the growth in the section such as plants Figure 4.9: A graph showing how the growth such as trees in the product life cycle Figure 4.10: Steps showing the product lifecycle Figure 4.11: An infographic showing how a deal has been Figure 4.12: A person analyzing his trades online via phone and laptop Figure 4.13: A drop in the market Figure 4.14: A person analyzing their annual profits Figure 5.1: Background diagrams Figure 5.2: Stack of coins Figure 5.3: Business man trading online Figure 5.4: Wooden Sea Saw with value-price wording Figure 5.5: Concept of rising energy Figure 5.6: Piggy bank Figure 5.7: Symbol illustration Figure 5.8: Blue gradient concept Figure 5.9: Food industry labeling Figure 5.10: Packaging Figure 5.11: Automatic case and box labeling Figure 6.1: An image showing a retail shop Figure 6.2: An image showing a wholesale store Figure 6.3: An image showing a brief description of retailing Figure 6.4: An image showing a brief description of wholesaling Figure 6.5: An image showing a brief description of value proposition Figure 6.6: An image illustrating the main components of a market value proposition Figure 6.7: An image showing the types of a value proposition Figure 6.8: An image showing the value proposition examples Figure 6.9: An image showing channel design process Figure 6.10: An image showing a summary of the factors affecting channel selection

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Figure 6.11: An image showing the types of middlemen Figure 6.12: An image showing an example of government regulations Figure 6.13: An image showing a brief summary of what is logistics management Figure 6.14: An image showing a summary of the benefits of logistic management Figure 6.15: An image showing a summary of the top challenges of logistics management Figure 7.1: Digital marketing concept Figure 7.2: Books of advertising Figure 7.3: Digital marketing concept Figure 7.4: Creative diagram Figure 7.5: Internet advertising Figure 7.6: Marketing linear icons Figure 7.7: Sales banner Figure 7.8: Contextual advertising Figure 7.9: A man on a call Figure 7.10: Discount banner Figure 7.11: A woman shouting megaphone Figure 8.1: Strategic marketing program Figure 8.2: Internet marketing Figure 8.3: Social media marketing Figure 8.4: Email marketing Figure 8.5: Team reviewing a marketing plan Figure 8.6: Performance of implemented strategies Figure 8.7: Illustration on ROI Figure 8.8: A marketing strategy Figure 8.9: Evaluating a marketing strategy Figure 8.10: A project planning software Figure 8.11: Documents in files Figure 8.12: Airhorn Figure 8.13: Work flow illustration Figure 8.14: Making a list Figure 8.15: Concept of leadership Figure 8.16: A chart flow Figure 8.17: Concept of teamwork Figure 8.18: ROI illustration

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Figure 8.19: Customer feedback Figure 9.1: The process of market control and evaluation Figure 9.2: Modern day market activities are majorly embedded in financial services Figure 9.3: An overview of some of the common market control techniques Figure 9.4: Customer analysis allows the company to gather information about particular users Figure 9.5: Companies can analyze the behaviors of their customers and use those behaviors to perfect their service delivery Figure 9.6: The process of behavioral analysis Figure 9.7: Some of the important info gathered on customer demographics Figure 9.8: Step by step market research Figure 9.9: Controlled experimentation represent the analysis of a market in which all elements are kept constant except the independent variable Figure 9.10: An imagery of observational study/research Figure 9.11: The aspect of correlation; prediction Figure 9.12: Research study involves both experimental and non-experimental studies Figure 9.13: A cycle of the customer feedback strategy Figure 9.14: Marketing cost involves both variable and fixed costs Figure 9.15: Diagrammatic representation of the annual plan control Figure 9.16: Steps in profitability control Figure 9.17: Efficiency control mechanisms Figure 10.1: Multidimensional scaling Figure 10.2: An infographic on certain aspects of multidimensional scaling Figure 10.3: Vectors used in MDS Figure 10.4: Graph charts on factor analysis Figure 10.5: Factor analysis increases income Figure 10.6: Scaling leads to increasing profits Figure 10.7: Perceptual mapping Figure 10.8: A paper reading multiple sclerosis Figure 10.9: An image showing a Likert scale Figure 10.10: Another example of the Likert scale Figure 10.11: An infographic in scalability Figure 10.12: An infographic on Shepard diagrams

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LIST OF ABBREVIATIONS

AMC

American motors corporation

AI

artificial intelligence

CTA

call-to-action

CMDS

classical MDS

CAD

computer-aided design

CRM

customer relationship management

DIM

difference matrix

ERP

enterprise resource planning

FA

factor analysis

JTBD

jobs-to-be-done

KPI

key performance indicators

MIS

management information system

MVP

minimum viable product

MDS

multidimensional scaling

NPS

net promoter score

NPD

new product development

PPC

pay-per-click

PLM

product lifecycle management

PoC

proof of concept

RM

relationship management

RFQs

requests for quotations

ROI

return on investment

SUV

sport utility vehicle

SAS

statistical analysis software

SWOT

strengths, weaknesses, opportunities, and threats

TQM

total quality management

USP

unique selling point

UX

user experience

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WMDs

weighted MDS

WOM

word-of-mouth

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ABSTRACT

Business-to-business customers represent a lucrative and complex market that deserves a separate analysis. Marketers seeking to serve the needs of organizations rather than households face specific challenges and opportunities. This corporate marketing volume provides an ideal platform to deepen readers’ understanding of the competitive realities of global markets, customer relationship management and cross-sectional decisionmaking processes, supply chain management, e-commerce, and related fields. These core content areas resonate with business stakeholders and directly address important educational priorities. Second, the volume provides a perfect tool for examining the unique characteristics of the high-tech market and identifying the unique challenges facing marketing strategies in this field. E-commerce is also entirely within the category of commercial markets. In fact, the opportunity for e-commerce in the business-to-business market is estimated to be many times larger than the opportunity that exists in the business-to-consumer market. This volume highlights the similarities between consumer goods and business-tobusiness marketing and details where to start. Special attention is given to market analysis, an organization’s purchasing behavior, customer relationship management, supply chain management, and the subsequent adjustment of elements of marketing strategies used to reach an organization’s customers.

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PREFACE

Business-to-business (B2B) marketing is when you send direct marketing to another company or business contact. Direct marketing is broad and includes any type of advertising, marketing, or promotional material. In a business-to-business model, companies and organizations exchange goods and services. For example, one company might contract with another company to supply the raw materials needed to manufacture a product. The needs and interests of readers are at the heart of the writing of this volume. The authors aim to provide a clear, timely, and engaging examination of corporate marketing management. To this end, each chapter provides an overview, highlights key concepts, and includes several carefully selected contemporary business examples. This volume expands and synthesizes marketing strategy development using a balanced scorecard rich in strategy mapping. Particular attention is paid to defining the characteristics of a successful business-to-business company and linking marketing to other key functional areas such as manufacturing, research and development, and customer service. This functional integration planning perspective is an important point when analyzing the strategy development process. The volume provides examples of competitive and rapidly growing economies such as China that are currently using business marketing management. It also examines each component of the marketing mix from a commercial marketing perspective. This volume pays particular attention to the branding process and the strategic importance of delivering competitive value to customers. The sections on Product Innovation Management and Business Market Service Management further deepen the discussion. Again, special attention is paid to e-commerce and supply chain strategies for commercial markets and the effectiveness and financial impact of relationship marketing programs. Marketing performance measurement is also a focus of sales. It provides concise handling of marketing control systems and uses the Balanced Scorecard as a framework for analyzing marketing results. Special attention is also paid to identifying the drivers of marketing strategy performance and key areas of business marketing firm strategy implementation. The author also includes a series of case studies tailored to the business marketing environment. Over the past two decades, relationship marketing has expanded its scope from pure transactional analysis to a key dimension in forming a business strategy. Against this background, this volume identifies the most important drivers for building customer relationships. This becomes clearer when the context is a business-to-business (B2B) sales relationship. This volume explores some of the most important factors in B2B

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relationship marketing and their importance to corporate marketing management. B2B marketing is marketing that treats individual companies and their decision makers as customers (business-to-business marketing), rather than marketing that treats individual consumers as customers (B2C or business-to-consumer marketing). If B2B wants to compete online, it must implement a successful marketing strategy. Your marketing strategy should include multiple channels and methods to most effectively reach and engage your target audience. Managing customer experience has become a key priority for marketing executives and researchers.

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CHAPTER

MANAGING THE MARKETING PROCESS AND MARKETING PLANNING

CONTENTS

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1.1. Research and Selection of Target Market ............................................. 2 1.2. Analyzing Marketing Opportunities .................................................... 5 1.3. Types of Analysis to Identify Market Opportunities .............................. 6 1.4. Developing Marketing Strategies ....................................................... 11 1.5. B2B Email Marketing ........................................................................ 12 1.6. Best Practices for B2B Email Marketing ............................................. 12 1.7. B2B Digital Marketing ...................................................................... 13 1.8. B2B Content Marketing..................................................................... 14 1.9. B2B Social Media Marketing............................................................. 15 1.10. Planning, Implementation, and Control of Marketing Plans (Marketing Mix).............................................................................. 16 1.11. Alternative Marketing Mixes ........................................................... 19 1.12. Emerging Trends in Business Marketing Management...................... 22 1.13. The Buyer’s Journey......................................................................... 23 1.14. Phases of the Buyer Journey ............................................................ 23 1.15. Buyer’s Journey Mapping ................................................................ 25

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Business Marketing Management in a Business-to-Business Context

Offering a great product or service doesn’t guarantee that individuals will buy what your business sells. You need to market your product or service to potential customers. You can market the product to everyone, but casting a broad net doesn’t mean you’ll get more sales. You require a target market. Identifying your company’s target market allows you to narrow down your effort in order to promote your product to people who might buy, rather than wasting resources and time marketing to everybody (Yang & Gabrielsson, 2017). Effective marketing is hard to find. When developing a marketing strategy, marketers must make numerous trade-offs between creative requirements, budget constraints, and channel decisions. However, the biggest determinant of effective marketing is your target audience. If you don’t properly target your consumer personas, your promotions and ads are likely to drop on deaf ears. You may as well not do any marketing at all. However, the audience that differs the most is between individual consumers and companies. Some businesses serve individual buyers, whereas others serve companies and organizations. Corporate marketing is very different from marketing to individual consumers. Hence, a completely different approach to marketing – B2B marketing is needed.

1.1. RESEARCH AND SELECTION OF TARGET MARKET

Figure 1.1: Market segmentation on consumption across communication classes Source: https://www.intechopen.com/chapters/70488

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The target market comprises a group of people who can benefit from the company’s products or services. Among the best ways to identify a target market is to begin with what you offer. What concerns or customer problems does the product solve? What features and benefits do customers enjoy from using the product? Determine who will benefit most from the product or service (Wang et al., 2008). While this product may help everyone, the target market is the group that will benefit largely from purchasing the product. Consider the different demographics that need the product or service. Among the factors to consider are: values, occupation, location, education and income level, age and gender, occupation, lifestyle, and interests. Studying demographics helps not only with identifying target markets, but also where those individuals go for information.

1.1.1. Examine the Competition’s Target Market You can also reach out to your competitors to get answers about where to direct your marketing efforts. Companies should be aware of their competitors and other products or services that compete with them in the market. You should not only examine what they offer, but who they market to and how they promote their business. Begin by researching competitor websites, marketing equipment and social media to gain some insights (Wang et al., 2016).

1.1.2. Assess the Industry’s Target Markets When doing your research, don’t forget to search for insights from the target audience in the particular industry. Identify industry publications, statistics, market reports and other material to help narrow the desired audience. You may also perform market research individually to understand the target audience better.

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Business Marketing Management in a Business-to-Business Context

1.1.3. Determine the Niche Target Markets

Figure 1.2: Process of selecting target markets Source: https://open.lib.umn.edu/principlesmarketing/chapter/5–3-selectingtarget-markets-and-target-market-strategies/

When you start choosing the right target market, think about how to segment the audience. Are there specific people who would benefit the most from the product? What about particular geographic markets? These niches may deserve more attention when planning future marketing campaigns.

1.1.4. Review the Existing Customer Base Another method to choose the right audience is to examine your existing customer base. If already in business, you may easily access data that helps you identify factors such as customer demographics and purchasing preferences (Voola et al., 2022). Knowing your current customers can go a long way in correctly marketing the business to potential consumers with comparable preferences and needs.

1.1.5. Continue Evaluating the Target Market Choosing a target market is not a perfect science. Researching your consumers, competitors, and market will help to narrow down the focus, however you may need to fine-tune your marketing strategies over time.

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A successful company continuously analyzes its performance and strategic plan to ensure it remains on track.

1.2. ANALYZING MARKETING OPPORTUNITIES

Figure 1.3: Market opportunity analysis Source: https://customerthink.com/market-opportunity-analysis-what-is-ithow-can-businesses-do-it-the-right-way/

In the modern business environment, continued growth and profitability are by no means guaranteed. Technological and scientific progresses have shortened the life cycles of products and services, corporate models have changed, and new competitors have emerged from outside the sector. This continued instability makes it essential to look for new business opportunities (Veloutsou & Taylor, 2012). First, you must define a structure that will help you find opportunities. To do this, you need to understand your organization’s business direction and understand your company’s resources, strengths and capabilities. Upon understanding the company’s goals and sector of expertise, the next phase is to evaluate the market, assess consumer needs and how today’s companies, competitors, and existing regulations fulfill those needs. To identify market opportunities, business models must be assessed holistically by identifying consumers and businesses as well as other factors like brand value propositions, supply chains, direct and indirect competitors, current regulations and the overall environment.

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1.3. TYPES OF ANALYSIS TO IDENTIFY MARKET OPPORTUNITIES 1.3.1. Analysis of Purchasing Situation Buying trends should also be checked to review expansion opportunities. The questions to ask when looking at purchase analytics include: • When do individuals purchase the products or services? • Where to they buy? • How to pay? • Is it when they need it? Looking at sales channels, payment procedures, and all the other things that influence buying decisions can reveal how consumers buy and how to position products appropriately to them. Offering new shopping options can bring in new customers (Theron et al., 2008). For example, in the aisles of the subway in Santiago, Chile, vending machines selling snacks such as yogurt and fruit juices have been established to encourage consumption on the go. Another aspect to review is the acceptance of different payment methods. For example, Amazon recently started Amazon Cash in the US, which allows consumers without a credit card to shop virtually by adding money to their individual Amazon account.

1.3.2. Direct Competition Analysis Apart from analyzing demand and purchasing, it is also essential to analyze supply. When evaluating opportunities, it is important to understand the existing players in the market in which you compete or will compete. The relevant questions in this situation are: Which products and brands in the industry are growing faster and why? • What is the competitor’s value proposition? • What competitive edge do we enjoy over them? For instance, SKY Airlines, which competes with well-positioned brands like LAN in the Chilean market, found a chance to differentiate itself through a low-cost model that did not exist in Chile before 2017, according to Euromonitor International.

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1.3.3. Consumer Segmentation

Figure 1.4: Customer segmentation can be determined by factors like demography, geography and behavior Source: https://www.efficy.com/customer-segmentation/

To understand your needs, you need to identify consumer groups that share common features. These features can be “hard” variables including age, income level, gender, education level, area of residence, and occupation whereas “soft” variables include attitudes, values, lifestyle, and consumer motivation. Hard variables may help in estimating the amount of possible customers a business might have (Tuten & Urban, 2001). Soft variables can help identify motivations leading to purchasing decisions, including prestige, convenience, durability, design and price. An illustration of how segmentation can help categorize market opportunities is Aguas Danone, a bottled water business in Argentina. Soft drinks and juices taste good but are considered high in calories. The company recognized an opportunity to produce healthy beverages with both taste and flavor. As a result, they successfully launched Serflavored bottled water. Aguas Danone has been the leader in low-sugar bottled water in Argentina since its launch in 2002, overtaking giants like Nestle and Coca-Cola, according to Euromonitor International. Starting 2016, Aguas Danone still owns 57% of the non-trade value ratio of reduced sugar-flavored bottled water.

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1.3.4. Indirect Competition Analysis Opportunities may also be found through assessing substitute industries. For instance, due to lower airfares, airlines can examine opportunities in consumer sections currently served by other modes of transport. Airlines should study how many people travel using long-distance trains and buses, which routes are the most popular, how much travelers pay for airfare, how busy long-distance buses and trains are, and more (Theron et al., 2008). This form of analysis helps build competitive edges against indirect competitors, while offering insight on new opportunities for development.

1.3.5. Analysis of Other Industries In some situations, the goal of a company is not to continue operating within an industry sector, but to expand on a particular business model or idea. For example, British conglomerate Easy Group began maximizing the load factor of its flights with Easy Jet. Easy Group understands that selling at a lower price is preferable to not selling at all. Easy Jet has opted for a rate management model that depends on flight occupancy and flight time. This business model makes it possible to improve occupancy rates. Easy used a similar model to cinemas when developing Easy Cinema and afterward used the bus in Easy Bus. Whichever case, to enter a new industry, you must first understand the competitors: market share, growth rate, market size, per capita sales, brand positioning and even unit price (Theron & Terblanche, 2010).

1.3.6. Analysis of Foreign Markets When a business invests in a mature or saturated industry, exploring other countries may lead to more opportunities. Markets in diverse countries grow at different rates for a number of reasons, including differences in economic development levels and native habits. Understanding the progression of per capita consumption of a certain product in a particular country can act as an gauge of product life cycle maturity. Information about market size and competitors in different countries helps to assess business potential. Apart from product sales, you can also look at what is happening in developed countries from the perspective of consumption habits. For example,

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What is the market ratio of private labels in a given sector? What percentage of individuals use their smartphones for purchases?

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The responses of more developed countries to these questions can be used as an indicator of their own index potential (Streukens et al., 2011). Otherwise, monitoring what occurs in other regions may lead to fresh products/services still missing in the present market.

1.3.7. Analysis of Complementary Products/Services Companies should monitor the performance of other businesses’ products to complement their own. For example, a packaging business should monitor sales of the products it may package, while a business that makes coffee machines should gather insights into sales trends for different varieties of coffee. Inclinations in complementary markets must be considered before making investment decisions.

1.3.8. Environmental Analysis Market opportunities may also be recognized by evaluating environmental changes and technological and scientific developments that create new business opportunities. For instance, the progress of the Internet and smartphones has led to the emergence of companies with new corporate models. For example, Uber and Airbnb. Euromonitor International mentions that mobile internet subscriptions accounted for 20% of global mobile subscriptions in 2011 and 53% in 2016. In addition to mobile phones and the Internet, artificial intelligence, robotics, the Internet of Things, biotechnology and renewable energy also offer a wide range of business opportunities (Shaltoni & West, 2010). Variations in a nation’s regulatory structure can also develop opportunities. Since June 2016, Chile has required companies to label products high in calories, sugar, saturated fat and sodium. This commitment may present a growth prospect for healthier products unaffected by new labels. Euromonitor International estimates product sales in Chile to be affected, based on the kind of product. Doing more market research on category and product sales in Chile can help classify categories with growth prospects for new unlabeled products. Other environmental changes like climate change, geopolitical movements and variations in financial markets also affect market opportunities. The use of market research must be considered to gain insight into the local business environment, guaranteeing that the strategy will prosper in new or emerging markets.

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Purchasing Decisions, Direct and Indirect Competitors, Consumer Segmentation, Complementary Products and Services, Industry, Foreign Market and Environmental Analysis are the different types of analysis that can help your business detect new market prospects. Using different analytics will help your organization gain a holistic perspective of opportunities and develop long-term strategic corporate plans. Once an opportunity is identified, the company must act quickly to develop a plan (Sharma et al., 2010). It is important to create a value proposition, design the commercialization chain and review costs, cash flow, financing needs and revenue. Not all identified market opportunities will be successful, but experimentation will provide answers to the potential of each opportunity. To reduce the cost of failure prospects, pilot new products, services or business models in controlled areas can be tried. One of the risks of pilot testing is exposing your strategy to competition. All risk factors must be considered to reduce the chances of failure. During pilot testing, different experiments may fail but others will succeed and grow at a greater scale. For instance, in 2013 Coca-Cola started Coca-Cola Life as part of the Low Calorie Cola Carbonates class. This was a pilot test that began in Cile and Argentina, then by launches in different nations like, Sweden, Australia, the UK, Switzerland, New Zealand and Japan. Business of CocaCola Life didn’t develop as much true to form in a significant number of these business sectors. As per Euromonitor International, in 2016 Coca Cola Life came to below 2% value offer in Australia and under 4% value offer in the UK. Accordingly, Coca Cola stopped the brand in those two nations (Sheth, 2020). In different nations comparative measures have been declared: retirement of the product offering in the market or decrease of production. Pilot testing assisted Coca Cola with deciding progress of Coca Cola Life, since a disappointment at a worldwide scale would have had greater expenses as far as expenditure and brand picture are concerned.

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1.4. DEVELOPING MARKETING STRATEGIES

Figure 1.5: Social media is a vital marketing strategy in the modern age Source: https://sanstonz.com/business-and-marketing-strategy/

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b.

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Define your brand positioning: To formulate a viable strategy, you need to completely comprehend your brand positioning. This assertion is the when, why, how and who of your personality—or how your image is seen through the eyes of the client. Create a brand positioning declaration that your group and imminent clients can believe, and you’ll be prepared for the subsequent stage (Stein et al., 2013). Recognize your target group: Determine your interest group— or who’s truly searching for your brand’s offerings. That information shall assist you with developing consumer personas and comprehend how they settle on buying choices, an instrument that is incredibly helpful for marketing. Perform a competitive analysis: Look into the market and see what different organizations are marketing to your target group using a competitive analysis. Some things to remember when reviewing other contenders are: •Competitor product listings •Competitor sales strategies and results •Competitor marketing material and digital presence (Sivarajah et al., 2020). Getting a rough idea of these things can assist you with identifying your rivals’ strengths, weaknesses, opportunities, and potential threats—also called SWOT analysis.

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d.

Explore marketing networks to follow: When performing competitive analysis, you’ll notice the various kinds of marketing channels your rivals use effectively, and the channels they haven’t exploited. Learning from this, you can begin differentiating your own B2B marketing portfolio and arrive at the businesses that you need. Contingent upon your client segments and competitor analysis, examine channels, strategies, and instruments to advance your leads and client funnel. The below classifications are B2B advertising channels that can connect you with the ideal target group.

1.5. B2B EMAIL MARKETING Email marketing is a dependable strategy for interacting with both individual consumers and corporate clients. Statistics show that 93% of B2B advertisers use email, it would be ideal for you to join in as well. Messages lead to commitment which transform subscribers into leads, and afterward clients. Different from B2C clients who answer best to feelings and amusement, most B2B clients search for rationale and positive ROI (Spyropoulou et al., 2010). Basically, they’re asking themselves, how might your business at any point assist my business with developing? Along these lines, your email marketing must resound with your business clients and spotlight on things that make a difference to them—such as time, cash, and resources. Email marketing is likewise a strong vehicle for promoting your brand’s content. 83% of B2B organizations use email pamphlets as a component of their content marketing endeavor, and 40% of B2B advertisers say these bulletins are key to their content marketing achievement. With the steady influx of email messages flooding our inboxes nowadays, it’s a higher priority than any time in history to make and dispatch effective marketing emails.

1.6. BEST PRACTICES FOR B2B EMAIL MARKETING

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Write appealing titles. Consider your email titles as a Netflix promo—if you can’t entice your audience with a brief introduction, don’t expect that they should open and interact with the whole content. Ideally, invest nearly as much energy in your email headlines as you do on the actual messaging. Apply one call-to-action (CTA) per email. If you believe the quantity of email messages you get is a great deal, examine the

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CTAs in those messages since some are loaded with multiple, and in some cases up to 10 unique CTAs. Try not to commit this error, which can leave your beneficiaries’ minds whirling, inquiring “What would it be advisable for me to click on first?” and ultimately tapping on nothing. With a single CTA per email, you permit your audience to zero in on your email content and eventually one activity, a welcome respite from the present decision-making paralysis effect. Segment your email for reaching the most appropriate audience. Few out of every email you send will be proper for everybody on your list. The subscribers might be at various phases of the purchaser’s journey or be looking for diverse solutions. That is where email list segmentation becomes possibly the most important factor (Saura et al., 2021). Not in the least does this assist with connecting with your audience better, however it gives your email messages that individual feel that says “Hello, I’m tuning in and I understand what you want to see.” Customers prefer email appeal over quantity any time. Ensure your email plans are responsive. More than 80% of email clients access their inbox on their smartphones, and email messages that don’t appear accurately on cell phones are many times erased in seconds. Additionally, you can’t send promotional emails without recipients—these individuals constitute your lists. There are a lot of quick methods for developing your email list. Start with opt-in solutions on your site landing page, about page, and blog.

1.7. B2B DIGITAL MARKETING Each business, whether B2B or B2C ought to have a digital presence, which includes paid promotions, search engine optimization, a site, and some other spot your B2B organization is active on the web. Among the key strategies that can reinforce your B2B digital marketing process include a solid B2B online marketing process begins with describing the ideal customer, or purchaser persona. This psychographic data will illuminate pretty much every other advertising action there on, guaranteeing your content and online content is consumed by the appropriate eyes and ears, plus no resources are wasted on your part. Other strategies include:

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a.

Building your website: Digital marketing can’t exactly work without an enlightening, engaging site. More than 80% of consumers visit a site prior to making a buy. Besides, since the average B2B sales cycle frequently includes central players like decision makers, and different people who need to get involved in a buy, websites are simple, clear methods for influencers to share data about the product/service (Rusthollkarhu et al., 2022). b. Optimizing the digital presence: Your site should be more than instructive and connecting, it must also be discoverable. You can achieve this with on-page SEO and technical SEO strategies. These incorporate everything from image alt-text to meta-descriptions (what guests can observe) to structured data and website speed. Off-page SEO is additionally affecting everything here, which alludes to external linkage techniques and social sharing- SEO strategies that occur off your site. c. Run PPC campaigns: Ultimately, balance your online presence with pay-per-click (PPC) promotion, which permits you to get your brand before new audiences through digital search tools and other marketing platforms. I suggest boosting your PPC investment by marketing more than your particular products or services—for example, your brand personality, social media content, blog or organizational tagline. The most effective way to view an ROI from your paid promotions is by (a) integrating your customer persona data and (b) building content they can easily connect with. For instance, it’s quite far-fetched that a fresh consumer who has never known about you is looking for your particular product (Rosenbloom & Larsen, 2003). They might be looking for an area-based solution or product highlight. To reach the ideal number of prospective clients, consider paying to target relevant classes within your brand as opposed to sponsoring your product/services.

1.8. B2B CONTENT MARKETING While a conventional PR marketing methodology will affect a consumer’s decision with marketing material, a content marketing strategy contributes valuable data and lightens up the buyer—which is exactly the thing B2B consumers are searching for. Also that content marketing promotes SEO endeavors, which includes predicting what your audience is looking for,

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assisting them with finding your site and content and possibly switching them over to customers. It’s vital to note, content marketing is best when you adjust your content to different phases of the consumer’s journey. As Franchell Jonathan, CEO of Ironpaper mentions: “Effective content in the awareness stage teaches the consumer on their pain points.” A common error B2B businesses make is educating the consumer on their own business, product, or service. The consumer isn’t prepared for that; they are simply starting to grasp their concern (Rosenbloom, 2007). Franchell added: “B2B companies must also test content. Do incentivized testing and vary content types – use webinars, ebooks or videos. Find out what content formats appeal to the right kind of buyers and tailor them on an individual level. Measure it.” In fact, 80% of business decision makers would rather get information from articles than from advertisements. If marketers knew this, I they would invest the same (if not more) resources in content marketing as they would in a traditional advertising strategy. Since the B2B consumer’s journey is somewhat different than the B2C consumer’s journey (shorter sales cycle and fewer decision makers involved), the content you can create for your B2B content marketing strategy will be more than what you see as a consumer The content changes more often.

1.9. B2B SOCIAL MEDIA MARKETING

Figure 1.6: Businesses are communicating more frequently on social media Source: https://www.business2community.com/b2b-marketing/social-mediamarketing-really-work-b2b-0625941

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Statistics demonstrate that 75% of B2B consumers and 84% of C-Suite administrators use social media when shopping. That’s correct – social media marketing isn’t only for brands targeting individual consumers. However, many B2B companies often struggle with social media marketing. Interacting with business customers using social media can be more difficult, especially since there are often longer sales cycles and chains of command (Ritter & Pedersen, 2020). Candidly, B2B social media marketing is probably not where you convert the most leads, and that’s okay. It might come into play at the start of a customer’s buyer journey. Social media is an effective tool for creating brand awareness, providing your business a virtual personality, and humanizing your company – all of which are very powerful factors in marketing and reaching potential customers. Same as email marketing, social media is a very effective medium for sharing your content and improving your brand adeptness, the latter being a favorite among B2B customers.

1.10. PLANNING, IMPLEMENTATION, AND CONTROL OF MARKETING PLANS (MARKETING MIX) The implementation and management of a marketing plan is a process designed to ensure that the strategic goals set by the company are achieved. The functions of organizing and guiding people play a special role in this process. This includes creating an all-inclusive list of activities to be done, who will be responsible for those activities, and the resources required. Control of Marketing Programs – The key objective is the continuous monitoring and evaluation of the company’s marketing activities, recording discrepancies and reporting to management, which inspires decision-making based on these details.

1.10.1. The Process of Implementing a Marketing Proposal During the implementation of the marketing plan, managers must ensure the effective use of the company’s financial, human and marketing resources. The choice of strategy has a major impact on the subsequent operation of the business, as its organizational structure should adapt to the strategy (Pires & Aisbett, 2003). The effectiveness of strategic marketing depends to a large extent on the level of executive involvement in the execution of marketing tasks.

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Employee skills, attitudes and behaviors are a very important factor when implementing a marketing plan. The quality of management depends on: •

Leadership – participation of top management in the planning process; • Coordination – ensuring mutual cooperation between organizational units; • Communication – horizontal and vertical flow; • Organizational culture – market placement, values, customer orientation of employees; • Human resources – personnel selection, training and assessment; • Organizational resources – IT systems, leadership methods; • Motivation – Create a stimulating climate for employees to take action to achieve organizational goals; • Organizational structure – The relationship between organizational units, processes and formalization. The four Ps, the marketing mix, consists of four primary elements – price, place, promotion and product- applied when marketing products/ services. Typically, companies consider the four Ps when developing their marketing plans and strategies to efficiently market to their target group. The four Ps constitute a dynamic relationship with each other (Naudé et al., 2009). When developing a strategic marketing plan, everyone is considered equally important, rather than one prioritizing the other.

1.10.2. Product A product is a good or service sold to a target audience. In general, a successful product doesn’t necessarily have to be on the market right away, or provide a novel customer experience to generate demand. Chia Pets from apple, for instance, offers consumers a completely unique humorous experience. As you develop your product, it’s important to consider your target audience and their special needs. Some questions to consider when developing a product are: (a) What is your product? (b) What is the product doing? (c) Does the product meet an unmet need or provide a new experience? (d) Who is the target group for your product? (e) How is your product unique from other products?

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1.10.3. Price This is the cost of a particular product/service. When promoting a product or service, it’s essential to choose a price that fits both the target market and the company’s goals. Pricing can have a major impact on the general success of a product. For instance, if you price your target audience a higher product, very few of them will buy it. If you underestimate your product, some people will simply ignore it, worrying that it will be of poor quality and eat into your likely profit margins. To determine the winning price, you should thoroughly understand your target audience and their capacity to pay for the product. When considering the price of a product, you might ask yourself some questions: • •

What is your competitors’ product’s price range? What is your target audience’s price range?

1.10.4. Place A location is where you sell your products and the distribution channels you use to get your products to your customers. Similar to price, finding the right market and selling product is critical to reaching your target group. This can help you connect with your audience and put you on the path to success. For instance, let’s say you’re selling sneakers of your own design. Your target group is athletes in their 20s and 30s, so you decide to market your product in sports magazines and sell it at track and field stores in locations that best fit your marketing mix (Michaelidou et al., 2011). To determine the best venues to market and sell your products, you should examine the physical or digital locations where your target audience is shopping and consuming information. Some issues to consider are: • • •

Where shall you sell your product? Where does your target group shop? Which sales channels are ideal for your target market?

1.10.5. Promotion This involves how you promote your products or services. With promotion, you can advertise your products through effective marketing campaigns that resonate with the target group.

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There are multiple ways to promote a product. Some traditional approaches include word of mouth, print advertising, and television advertising. However, in the digital age, you can use other marketing channels to promote your products, such as: Email Marketing, Social Media Marketing and Content Marketing. Some questions to consider when running a product promotion are: • • •

When is the ideal time to reach your target group? Which marketing channels are most ideal for your target group? Which advertising method is most convincing to your target group?

1.11. ALTERNATIVE MARKETING MIXES The four Ps aren’t the single promotional mix utilized today. Some other present marketing mixes incorporate the five Ps, the seven Ps, plus the 5 Cs. While each of these mirrors specific elements of the four Ps, they likewise each have a few exceptional components that modify their emphasis on the promotion system. For example, the five Ps involves people apart from the four referenced previously. Today, different promoters apply the five Ps over the four Ps since it focuses the experiences of clients and staff in the promotion process (Möller & Parvinen, 2015). Common considerations involve how a client acts, their involvement in the product, and their general fulfillment with the business. Furthermore, the seven Ps incorporate processes and physical proof. The seven Ps are additional elaboration of the five Ps, including considerations of the processes that distinguish the client experience and the physical proof that the target market must see to become clients. Whereas processes could include the particular client care processes that distinguish a product, physical evidence may be sites or store displays that assist the target market envision themselves utilizing the product.

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1.11.1. The Five Cs

Figure 1.7: Employees discussing a strategic annual plan Source: https://www.wrike.com/blog/tips-for-better-annual-planning/#Whatis-an-annual-plan

The five Cs are client, competition, company, climate and collaborators. In certain regards the five Cs reflect a significant number of concerns of the five and four Ps, however with extra emphasis on external elements, like possible external collaborations and competitive research. Moreover, while “climate” alludes to the socioeconomic and political situation surrounding the market, “client” alludes to the target market and client experience. “Company,” in the meantime, alludes to the company place and their accessible resources in the marketing system (Möller & Halinen, 2018). The fundamental forms of marketing control include: • Annual plan control: Performed by mid-level administration (strategy: examination of sales, financial pointers, market share and so forth) Yearly plan control is the checking of current advertising activities and results to guarantee that the yearly sales and the profit objectives are accomplished. Yearly plan control implies persistent continuous performance check against the yearly plan and making the appropriate corrective measures. It is the obligation of the topmost and middle administration and the reason is to look at whether prescribed results are being accomplished

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with regards to sales, costs, finance, profits and perspectives of members in marketing tasks. The core of yearly plan control is the administration by goals. Under this, four phases are involved in particular: 1.

Defining month to month or quarterly objectives in the yearly plan. 2. Monitoring the real performance in the context of planned objectives. 3. Determination of reasons for remarkable or serious deviations. 4. Making a fundamental corrective move to plug the holes between objectives and implementation (Mudambi, 2002). This involves changing the original plans, objectives and progress. • Control of productivity: Implemented by marketing regulator (strategy: the revenue of the product, area, client segment, and so on) Profitability control is utilized to decide if to expand, diminish, or remove any products or marketing exercises. Efficiency control assists the organization with taking a look at better ways of overseeing advertisement spending and investments. A few organizations have founded a marketing regulator position to further develop marketing effectiveness. Profitability control exhibits the relative profit-earning limit of an organization’s diverse products and customer groups. Productivity management and efficiency control allow an organization to intently screen its sales, profits and expenses. Profitability control exhibits the relative profit-earning limit of an organization’s various products and customer groups (Mejri et al., 2018). Organizations are much of the time shocked to discover that a small ratio of their products and clients add to a huge portion of their profits. This knowledge can assist an organization with distributing its resources and efforts. • Efficiency control: Conducted by the marketing controller, line supervisors and HR division (strategy: the profitability of the area, product, customer segment and so on). Proficiency control includes mini level examination of the different components of the marketing mix, including sales force, publicizing, sales promotion, and appropriation. Proficiency control comprises mini level monitoring of the different components of the marketing mix, including sales force, publicizing, sales progress, and dispersion. For instance, to comprehend its sales force effectiveness, an organization might monitor the number of sales that a staff

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makes daily, call durations, and how much every call costs and produces in income. This kind of analysis features regions in which organizations can deal with their marketing efforts in a more useful and cost-effective way (Leek & Christodoulides, 2011). • Strategic control: It done by top administration or marketing inspector (strategy: positioning of the efficacy of marketing, advertisement audit, assessment of marketing excellence, a review of the ethical and social obligation of the business). Key control processes allow supervisors to assess an organization’s marketing program from a crucial long term viewpoint. This includes a point by point and objective analysis of an organization’s association and its capacity to increase its strengths and market prospects. Organizations can use two kinds of key control tools. First, which an organization applies to assess itself, is known as a marketing-effectiveness rating analysis. To rate its own marketing viability, an organization looks at its client reasoning, the sufficiency of its promotional information, and the productivity of its marketing endeavors. It will likewise intently assess the strength of its marketing procedure and the combination of its marketing strategies.

1.12. EMERGING TRENDS IN BUSINESS MARKETING MANAGEMENT a) Personalization for Local Markets Local personalization is a complex reality for the present-day advertisers. With the quick growth of technology, the globe is contracting and individuals are immersed with advertising messages. Potential clients are presented with huge number of advertising messages every day, a considerable lot of which they don’t need since they weren’t meant for them (Backhaus et al., 2011). A business can stand over the group by applying contemporary segmentation and personalization methods to fit your message to every customer in their preferred language. This isn’t simply looking at adding their names to the email. Effective advertisers create their messages to address their clients’ needs at a particular moment. b) Using Multi-Channel Communications Effective advertisers have figured out how to coordinate their communications. In the present quick-paced marketing environment, this is tougher than any other time in recent history. One successful answer for this challenge is to use automation—including computerized resource

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management programs and regional marketing automation—to enable the group to make more viable promotional material that addresses their local audiences and design the messages to the buyer’s journey in an everevolving plan that assists them with moving along the road to turning into your client and finally promoters for the business.

1.13. THE BUYER’S JOURNEY The buyer’s journey is the cycle your potential client goes through when making on a buying choice – from acknowledging they have an issue or a need in the ‘awareness’ stage, through exploring and teaching themselves further on the accessible methodologies or choices during the ‘consideration’ stage. Brand marketing trends aren’t new to veteran promoters, however figuring out how to actually use technology to improve your business is vital to progress and even endurance. The present consumers are besieged with undesirable messages in their day to day routines, email and social feeds. Advertisers can never again depend on “pushing” their promotions to the crowd by running a greater amount of them, or talking stronger, and trusting that individuals follow up on the message (Lim, 2018). The present powerful advertisers need to put the right message before the ideal group brilliantly to transcend the chaos and “pull” the crowd toward their brand with extraordinary marketing content. There are three recognized stages in the “Buyer’s Journey”: Awareness, Consideration and Decision. With the amount of outlets accessible to reach clients increasing, it’s presently more effective than any other time in recent memory to convey the right message, to the right crowd, and brilliantly.

1.14. PHASES OF THE BUYER JOURNEY As highlighted above, the ordinary buyer journey is comprised of three key stages: Awareness, Consideration and Decision • The awareness stage The buyer’s journey starts when a potential client becomes mindful that they need or require an item or service and are ‘available’ to different solutions and counsel. At this phase, the consumer is probably going to go to online tools to teach themselves about their concern and the likely measures – so the educational material on your site, steered in long-tail keyword research, is fundamental here. Being ‘found’ searching for the topics and

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aspects they are looking, at this stage, is a fabulous beginning to creating a relationship which is probably going to progress (Baumgarth & Schmidt, 2010). As far as language and tone is concerned, in the beginning phases of the consumer journey, it is pivotal to be enlightening and as unprejudiced as conceivable since the reason here is to teach and build brand trust with prospective clients. The awareness phase isn’t the perfect opportunity to advance deals informing or providing financial incentives. It involves addressing their underlying challenges and issues and giving responses to the inquiries that they will present. Content material that thrive in the ‘awareness’ stage often include: • Whitepapers • Digital books • Industry insight and information pieces • Long-structure blog entries • The consideration stage Upon entering the consideration stage and after preliminary research, the client has a more clear perception of what they must accomplish and is focused on finding the correct solution. In any case, they are yet to distinguish what that resolution is. While more ‘qualified,’ the client is as yet not prepared to purchase, so sales language and motivations are to be stayed away from. Instead, they might still be gauging expected prospects, contrasting costs and investigating which brand is generally appropriate for satisfying their need. Thus, you want to make it onto the waitlist of providers and brands they are thinking about – hence you should stick out. You must keep on adding instructive incentive for the consideration stage client, proceeding to build trust and showing your position and mastery (Bendixen et al., 2004). This phase is especially suitable for higher-value interactions. Content forms that perform well during the consideration stage include:

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Features and benefit-centered useful video or comprehensive product/service information sheet Appropriate tools like calculators or product locaters Professional guides

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• Contextual analyzes • Consultations • Lead generation landing pages • Content offers • Online classes and digital broadcasts • The decision-making stage The consideration stage is time to take care of business. You’re on the waitlist and it is the moment when all of your insistent effort will ideally pay off ultimately. Your potential client probably identified which arrangement classification is the most appropriate to their requirements and they are prepared to figure out which provider to use. Here, surveys, consumer reviews, costs, and other different motivating forces will impact their final buying choice. With regards to informing, whenever necessary, this is the ideal opportunity to present a more remarkable language – further highlighting your highlights, benefits USPs and provide a buying motivation fit to your target group. When delivering your content plan, one of the main aspects of the cycle beside exploring your client profile and fostering the buyer journey, is in the product/service ‘benchmarking’ against your closest rivals (Lambert & Enz, 2012). By knowing who your competitors are, what they are talking about, and how they are locating their products/services, you can adopt a more educated strategy to create trust and having the most impact at this stage for a fruitful result. Recall that being successful isn’t about cost – it is much of the time about value and experience.

1.15. BUYER’S JOURNEY MAPPING It is fine understanding what the buyer journey stages are, yet how would you locate and inform them? There are several vital pieces of information you must be aware of to accurately define the consumer process, which can be acquired from basic bits of marketing research.

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1.15.1. Key Tips for Consumer Journey Mapping

Figure 1.8: The process of customer journey mapping Source: https://hypeinsight.com/what-is-customer-journey-mapping-and-whyis-it-important/

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Don’t overcomplicate matters. Indeed, consumer journeys can be complicated, yet in isolation, the inquiries they are posing must be well within the capacity of your business to respond. Content should be clear and brief, so don’t be enticed to overcomplicate your copy as well. It should be easy to use and supportive. No complex language. Use data. Whichever information you can use, like persona data or keyword details, enlightening the buyer always removes components of worry. Advertisers realize it’s impossible to get things 100% right, always. Yet, utilizing data to enlighten your way to a sale with journey mapping will build your possibilities of nailing it sooner (LaPlaca, 2013). Adjust and learn. Your consumer journey is a fluid component of your marketing process and is probably going to change regularly because of factors like technology, industry and external variables that are in many cases beyond your control. In this way, don’t simply create a buyer journey guide and afterward leave it there. Revisit it routinely to assist you with distinguishing any new gaps you require to load up with supportive material. Modify your CTAs to reach your ideal outcome. It is critical to use active language in call-to-actions (CTAs), which is frequently

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understood. However, where you can, customize and modify the CTA on every page to the point at which falling in your client’s journey is reasonable (LaPlaca & Katrichis, 2009). Using custom CTAs expands the possibilities of your potential consumers moving consistently into the following, desired phase of their buying journey.

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CHAPTER

MARKETING INFORMATION SYSTEMS AND MARKETING RESEARCH

CONTENTS

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2.1. Introduction ...................................................................................... 30 2.2. Proficiency in the Business of Advertising and Marketing .................. 31 2.3. Components of a Marketing Database’s Operating System ................ 32 2.4. Gathering, Storing, Analyzing, and Distributing Valuable Marketing Data ............................................. 35 2.5. Market Segmentation and Targeting .................................................. 39 2.6. Targeting and Segmentation of Markets ............................................. 42 2.7. Relationship Marketing ..................................................................... 43 2.8. Brand Management .......................................................................... 49 2.9. Customers Alone Aren’t the Only Ones Affected By a Brand’s Management ...................................................................... 51

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2.1. INTRODUCTION

Figure 2.1: The Management Information System (MIS) Source: https://media.istockphoto.com/photos/chart-analyze-picture-id117997 5275?k=20&m=1179975275&s=612x612&w=0&h=DlYRWuQWmn9DqkKZt E0hPdGUid5c4QKh9vtOJzmpRCo=

The management information system (MIS) is a system that may be used to gather, save, process, and disseminate essential marketing data. This type of system is known as a marketing information system, or MIS for short. In the data intake portion of a marketing information system, information is gathered for analysis and interpretation from both internal and external sources. Once the outcomes of the work done by a marketing information system have been broadcast to a large audience, all important executives and internal marketers will view the findings (Lages et al., 2008). After that, marketers may utilize the data to make better-informed decisions about marketing, which will eventually lead to higher success for the company as a whole. If higher-level marketing managers’ strategic plans have deviated, middle-level marketing managers are responsible for making judgments about controllable possibilities. These choices are made as a direct consequence of deviations from the long-term plan of the organization. Decisions about operations are those that affect the day-to-day activities of marketing professionals, particularly those decisions that affect whether

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or not certain promises are fulfilled. Strategic choices are made by senior marketing executives and have an impact on the entire company, including the policies, objectives, and organizational structure of the organization. These decisions are referred to as “big picture” decisions. The implementation of a marketing information system improves the effectiveness of a company’s internal communications (Lim et al., 2019). It provides accurate and essential information to guarantee that all internal teams are aware of their tasks and goals, as well as to keep those teams focused on those areas. The dissemination of facts that are already wellknown in a fair manner can also be of assistance in the fight against erroneous beliefs. The establishment of a marketing information system could be an additional factor that contributes to the overall success of your company. You may be able to make better choices if you start with material that’s been meticulously structured, and then proceed to review and examine it. Collecting and analyzing data for the advantage of your organization may also be accomplished through the use of novel approaches, which might be designed to make your operations more efficient or expand their scope. It’s possible that achieving this is one of your goals. Using a marketing data support system, businesses can collect, organize, and efficiently evaluate data. This system is comprised of a wide variety of software and technology components (Biemans et al., 2010). It is possible to include a large number of different applications or tools into a single system to provide users access to a greater variety of specialized options for completing certain tasks. When many applications can connect, the functionality of the MIS is supported by the structure of the system.

2.2. PROFICIENCY IN THE BUSINESS OF ADVERTISING AND MARKETING Data or information acquired from external sources such as trade journals or industry organizations is one kind of marketing intelligence. There is information available on both the inner workings of various markets as well as the external marketing environment that surrounds such marketplaces. Utilizing this data will allow the firm to have a better grasp of the industry as a whole as well as its competitors. Listed below are some examples of how marketing intelligence has been put into practice:

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• • • • •

The many tastes and inclinations of individual customers; The several approaches to pricing that are utilized by competitors; Marketing strategies used by those that are in direct rivalry with you; The unpredictable movements of the stock market; Merchandise that has never been offered or sold before.

2.3. COMPONENTS OF A MARKETING DATABASE’S OPERATING SYSTEM

Figure 2.2: Components of a Marketing Database’s Operating System Source: https://media.istockphoto.com/photos/business-negotiation-conceptmarketing-manager-talking-to-business-picture-id1079404170?k=20&m=10 79404170&s=612x612&w=0&h=YXLUJiOYvBwgk8QkNslMzGVbNGf08u_ tPuNLJmc25T8=

2.3.1. Internal Documentation The internal records of the firm contain things like sales data, databases of customers and products, databases of financial information and operational information, and so on. The following is an exhaustive list of internal data sources, which may be found in the following section: Invoices, transmission copies, and billing papers provide the company access to the data if it receives an order for a product or service from a client, a dealer, or a sales

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representative. This allows the company to fulfill the order. It’s possible that the consumer placed the order. The marketing information system should be kept as up-to-date as possible by routinely saving the most recent sales information. This should be done as frequently as is practically possible (Lichtenthal & Eliaz, 2003). The management of the firm decides on the company’s goals after taking into account the current sales and inventory levels. Marketers may make use of this data to construct a strategy for future sales based on this data. The companies are the proud owners of a variety of databases, including one known as the Customer Database. This database is where we save information about our customers, including their complete names, addresses, and phone numbers, as well as the frequency of their trades and their current financial standing. One may visit this website to acquire information on the cost of a product, its characteristics, and the various options that are now accessible. Names, phone numbers, and sales quotas of salespeople are all maintained in a separate database that is designed specifically for each salesperson. A data warehouse is a frequent location for businesses to save their data to make it accessible at any time. After the data have been safely saved, various computer programs, procedures, and techniques are used to the data to transform the data into factual information. This system provides data about the firm’s external marketing environment, as well as information on current market trends, and it does so by providing both of these sets of data (Krings et al., 2021). It covers a wide range of topics, including shifting customer preferences and tastes, newly introduced items on the market, changing market trends, pricing methods employed by competitors, and a variety of other matters of a comparable kind. If you wish to have an efficient method of gathering information for marketing purposes, the following are some things you may do. The employees in charge of making sales should be provided with the appropriate training and encouraged to keep an eye out for changes in the market, such as shifts in customer preferences, and to make any required adjustments; Increasing the amount of information that channel partners who are also active market players provide about customers and competitors (dealers, distributors, and retailers) In addition, businesses may boost the efficiency of their marketing intelligence systems by making use of the information they obtain from their rivals and the markets in which they participate. You can accomplish this objective by making purchases from them, going to their trade shows, and reading articles written by them that are published in publications, journals, and financial reports. Customer advisory panels,

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which are typically made up of repeat clients, are more likely to be of assistance to businesses in the process of developing an efficient marketing information system (Kim & Moon, 2021). These customers, drawing on their own unique experiences, may be able to assist other consumers in making more educated choices regarding the acquisition of a product or service. Enhancing a company’s marketing information architecture can be facilitated by the utilization of data made available by the government to businesses. Statistics on population, demography, agricultural output, and other components of the economy might have an effect on the marketing plan that a firm chooses to implement. This is entirely possible. In addition, firms can receive information from research organizations that examine all players in the market thanks to this capability. An improvement to the Marketing Intelligence system might be made by using online feedback forms to directly question customers about their experiences with a variety of products or services. Research in marketing may be defined as the methodical gathering, compilation, study, and interpretation of primary or secondary data to locate answers to problems in marketing. Research in marketing is conducted by a wide variety of companies to apply a wide variety of statistical approaches to various aspects of the environment in which marketing occurs. These aspects include the changing tastes and preferences of customers, the various approaches taken by competitors, the wide variety of new products available on the market, and so on. The gathering of data is the essential initial stage in doing market research. Primary data are those that are obtained directly from the source, whereas secondary data are those that are compiled from a range of other sources (second-hand data, available in books, magazines, research reports, journals, etc.) In contrast to the simplicity with which one may have access to secondary data, the collection of primary data requires the researcher to adhere to a predetermined set of steps (Kumar et al., 2020). There are a variety of methods that may be utilized, some examples of which are inperson interviews, written questionnaires, online surveys, and in-person seminars. In the context of the marketing data system, marketing research makes a major contribution since it provides verified data that has been subjected to extensive investigation. With the assistance of a system such as this one, marketers may utilize a variety of software tools to do analyzes of their data and improve the quality of their business judgments. This program, as its name suggests, assists in making marketing decisions. Marking managers can use computers to

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tabulate data and conduct statistical analyzes on the data. Following this, decisions are arrived at by basing them on the findings of the analysis. Because of this, marketers need to keep a close eye on both the internal and external surroundings of marketing to establish proper standards, strategies, and plans (outside the organization).

2.4. GATHERING, STORING, ANALYZING, AND DISTRIBUTING VALUABLE MARKETING DATA

Figure 2.3: Valuable marketing data Source: https://media.istockphoto.com/vectors/concepts-for-creative-processbig-data-filter-data-tunnel-analysis-vector-id464806966?k=20&m=4648069 66&s=612x612&w=0&h=ffdxp_EGu9uiddJt51tvimfbniMrGWffNxKWHihxLNk=

Marketing research is the process of collecting, analyzing, and reporting on marketing data. The purpose of marketing research is to help a company become more profitable by identifying and addressing issues that it is currently facing. Marketing researchers are tasked with a wide range of duties. (Market research, on the other hand, necessitates a higher level of attention.) An analysis of the market’s size and trends is required.

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Marketing research, despite its limitations, can be useful in explaining some elements of decision-making. You’ve come up with an original product concept, and now you’d want to know what you should call it. Product names aren’t as simple as they look at first glance. A variety of scenarios might be resolved based on it. Make a call to the pesticide manufacturer the overseas branch of Out! Inc. In the 1990s, International came up with a name for an insect repellent that was safe to use around children and thought it particularly delightful. The brand name “Hey!” was used to promote the item. It’s monster time in my lair right now (Kleinaltenkamp & Jacob, 2002). There was an issue with the name itself since it made many people, particularly young people, anxious. They have no interest whatsoever in participating in the event. The “Museum of Food Failures” by Seth Stern. Marketing research may be used in a wide range of industries, including the following: New product concepts and layouts to come up with. Determining whether or not a product has a market before making a production decision. • Understanding which niche markets your items are most suited to. • Determining the best pricing strategy. • Evaluation of various packaging options. • Analyzing in-store marketing campaigns. • Keeping an eye on customer satisfaction levels. • Measuring the degree of satisfaction your distribution partners have. • Examining the degree of your website’s success. • Understanding how effective advertisements are and where they should be positioned. • Choosing a certain marketing strategy. A significant link between market intelligence and marketing research may be seen in this diagram. Market intelligence and competitive intelligence are two additional terms for this type of information. Concerning the newest market trends, market intelligence refers to the process of obtaining information on a continuing and regular basis, as opposed to marketing research, which is more focused on solving a specific marketing problem at a certain moment (Johnson et al., 2012). In the case of a convenience store, you may drive around to see what your competitors are pricing for gas or

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what products they are selling and promoting. You may also take a look at the things they’re advertising and the methods they’re using to market them. The owners of small firms can gain valuable knowledge about the market by talking to their consumers and suppliers about new product ideas. It is possible to do marketing research simply by asking your current customers what they think about a new product or service. The majority of the time, market research is handled by the marketing department in large corporations. However, they are not the first to make this move. Shortly, we’ll discuss who is responsible for what in the organization. As a student, it’s advisable to ask your other classmates for recommendations on the greatest lecturers to take classes from. Most firms routinely generate some quantity of marketing data as part of their day-to-day operations. This data on marketing is collected and stored each time a transaction is completed. Additionally, marketing data is obtained when salespeople enter shipping choices for a client into a company’s customer relationship management (CRM) system. After customer complaints have been received and logged, a corporation must utilize the information gleaned from this data. Every one of these bits of data may be used to get insights into consumers (Janita & Miranda, 2013). It’s still important to collect qualitative data, like consumer feedback, alongside quantitative data to have a fuller picture of the issues at hand (statistics). An organization’s day-to-day activities create and store a substantial quantity of data, such as sales and financial data, inventory levels, back orders, customer returns and complaints, as was previously said, A company’s database may contain this data. In addition, organizations collect data from their websites, such as clickstream data, regularly. In other words, clickstream data is a way to keep track of how many people visit a website and whose pages they visit, as well as how long they stay on the site and what they buy or don’t buy while they’re there. Data from clickstreams may be used in a variety of ways by businesses. With the use of this technology, businesses may determine the total number of people who have visited an online destination, as well as identify underutilized areas of the site and tailor their marketing efforts in response to their browsing habits. Data from website clickstreams may be tallied and used in management reports without the need for any human intervention (Iglesias et al., 2020). It’s been announced that Netflix is giving one-million-dollar rewards for any scientists who can help it better predict what Netflix customers want to rent using the Internet data generated by millions of their fellow subscribers.

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To gain an advantage over its competitors, a company’s decision-makers must be able to swiftly access internal clickstream and other data. There was a one-week gap between Target’s inventory data and that of Walmart, even though Target’s massive data center is similar in size to that of the Pentagon. Managers at Walmart saw an increase in sales of American flags following the September 11 terrorist attacks. To prevent Target from making any purchases, Walmart made orders with as many different vendors as possible. Some of the most sensitive data in a firm are made available to employees and management through the usage of intranets. Workers at a corporation can only access material on an intranet, which resembles the internet. To avoid having to ask an accountant to prepare a report on the sales of a certain product, a brand manager may search the business intranet.

Figure 2.4: Gathering data Source: https://www.jotform.com/blog/wp-content/uploads/2019/09/data-collection-featured.png

Because of the numerous products, company divisions, and databases that large corporations often have, they may have a plethora of information that cannot be published on an intranet. Consequently, obtaining the appropriate information might prove a challenge. It’s conceivable that you’re not seeing what’s right in front of your face right now. Connect with others who share your interests. Greg Pool One of the “go-to” BNSF Railway employees for obtaining marketing data, Pool works for the railroad corporation. When it comes to obtaining usable information from relevant sources, Pool is an expert in the field of data mining (Iankova et al., 2019). This requires access to a variety of databases and the development of computer programs.

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Managers may use the data collected by Pool in Excel spreadsheets to find trends in marketing.

2.5. MARKET SEGMENTATION AND TARGETING

Figure 2.5: Market segmentation Source: https://media.istockphoto.com/photos/geographic-demographic-income-and-generation-concept-picture-id1207733981?k=20&m=120773398 1&s=612x612&w=0&h=0klTU28_FFJyn8paEd_FW2Tj2vpqJJ7F50qJhcEBUBs=

The terms “market segmentation” and “market targeting” describe the processes used to discover a company’s potential customers, choose those customers to pursue, and provide value to those customers. Segmentation, targeting and placement can be used to achieve this goal (STP). The acronym STP represents the three components of segmentation, targeting, and positioning (Hunt, 2013). Initially, the procedure is segmented, which is the first step. It initially gathers clients who have similar desires to analyze the features of each group. Using a car manufacturer as an example, pricesensitive or price-insensitive clients may be categorized. People who are price sensitive have less money to spend at their leisure. A phase called targeting allows the company to narrow its target audience down to a specific subset. Businesses will take into account the market segment’s attractiveness when deciding on a course of action. What

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matters is the size of the market; if it’s lucrative; how much competition there is; how well a firm can meet its target demographic’s needs; and how well a product or service is marketed. The final step is to either position the company or establish a value proposition that will resonate with the desired consumer niche. Next, a corporation must communicate its value to its customers through the product’s design, distribution, and marketing. Customers with low incomes, for example, may find that a car manufacturer’s advertisements tout the vehicle’s dependability and economy when it comes to petrol use.

2.5.1. What Are How Various Businesses Structure Their Customer Base? According to their location, demographics, psychographics, behavior, and the advantages they seek, customers are often categorized into several distinct groups. An in-depth look at a customer’s psychographics takes into account everything from their character traits to their hobbies and worldview. Customers want a product to have certain attributes, such as being simple to use, reasonably priced, and having a high level of prestige (Hinterhuber & Liozu, 2015). Customer loyalty, frequency of purchases, and frequency of product use are all examples of consumer behavior. As a result of asking “why,” “what,” and “who,” you may come up with a wide range of definitions for customers. Understanding consumer behavior is one of the most challenging but essential challenges for organizations when it comes to segmenting their customer base. In this instance, the key question is “why?” Businesses may generate accurate predictions about future client spending by compiling data about past purchases. For businesses, this allows them to focus on the right clients at the right time. Customers’ buying patterns are of special interest to businesses. Depending on when the data was acquired, how often it was collected, and how valuable the data is, companies can segment it. Customer relationships are defined by their most recent visit to the store, the number of times they’ve purchased from there, and the total amount they’ve spent. They help companies assess the worth of their clients and the amount of their loyalty (Griffin, 2002). It is arguably the simplest approach to classify clients using the “who” classification method because the data is readily available. The age, number of family members, income, and educational level of an individual are all

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examples of personal data. These features, according to the corporations, are exactly what their customers want. A manufacturer is more likely to propose an SUV to a customer in their 40s with a big family than a twoseater automobile.

2.5.2. In What Ways May Businesses Locate the Perfect Clients For Their Products or Services?

Figure 2.6: Market segmentation Source: https://media.istockphoto.com/vectors/color-circle-divided-into-segments-market-segmentation-vector-vector-id952497016?k=20&m=95249 7016&s=612x612&w=0&h=MIieKMHywsN8SKr5lYgOb-WtgqhegTxhEdp8YLkZ1t0=

Tackling is the process of narrowing down the most desirable target audience and devising the best strategy for attracting new customers. For the most part, the type of products and services a company provides will define which customer groups it aims to attract. Aside from that, it determines the company’s marketing approach. Mass marketing works best when a niche market does not exist. Microsoft, for example, uses the same branding and marketing strategies for all of its clients (Gregory et al., 2019). Direct

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marketing works successfully in some niches, but it’s not for everyone. Dairy Queen Diners can create their own cakes in-restaurant. High-end corporations like Tiffany & Co. use handwritten letters as an additional form of promotion. A company’s market segmentation decisions are influenced by three factors. Segment characteristics are appreciated by companies. Two factors to evaluate are the industry’s growth rate and profitability. Another step is to assess whether or not a firm can meet the demands of various sectors by looking at its resources and skills. The visual attraction of a huge piece, for example, is enticing. Because of a lack of resources, a company may be unable to serve the full market. For the final step, a company analyzes its current and future rivals. A large and expanding market may be profitable, but it also brings with it additional competitors, which might reduce revenues.

2.6. TARGETING AND SEGMENTATION OF MARKETS Product, price, communication, and customer relationship management strategies are all part of a strategy’s iterative process. Product strategy is to increase the value that consumers obtain from a product. Both the most expensive and most affordable versions of the same product might be released first. To maximize earnings, the pricing strategy involves appealing to both price-sensitive and price-insensitive markets. A communication plan will make use of the appropriate media and advertisements to promote a product to the appropriate audience. For example, products aimed at younger audiences will be promoted via digital media since younger viewers spend more time on Google and Facebook than older audiences. Lastly, customer management systems determine the most effective ways to promote products based on past purchases made by customers (Dlačić, 2015). Discounts, priority boarding, and upgrading options are all included in these benefits. The strategy will look into the best approach to market the product at the right frequency.

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2.7. RELATIONSHIP MARKETING

Figure 2.7: Relationship marketing Source: https://thumbs.dreamstime.com/b/relationship-marketing-documentstitle-94788354.jpg

Maintaining and pleasing existing clients takes precedence over acquiring new ones in marketing, and this is especially true in the world of relationship marketing. It was founded on direct response marketing at first. It distinguishes itself from other kinds of marketing by emphasizing the long-term significance of client connections and extending communication beyond intrusive advertising and sales promotional messaging (Di Benedetto & Lindgreen, 2018). Technology has opened up new channels for social and collaborative communication, such as systems for maintaining customer relationships that go beyond the collection of demographic and customer service data. Here, we see how technology has enabled us to communicate in novel ways. Relationship marketing’s inbound marketing component includes SEO, content marketing, social media management, and application creation. Inbound marketing includes relationship marketing as a subset. This type of commercial transaction is known as “relationship marketing,” and it is distinguished by both the customer and the seller’s desire for a favorable experience. The purpose of this strategy is to go beyond the post-purchase exchange process with a consumer by providing a more tailored purchase and leveraging the connection to enhance relationships. This aim will be achieved by providing a more personalized buy and taking advantage of

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the connection. Relationship marketing, as opposed to other types of marketing, focuses on developing and maintaining long-term connections with customers. Professors Berry and Jackson, both from the United States, were among the first to popularize the concept (1985). According to Berry (1983), relationship marketing is a type of marketing activity in which firms develop, maintain, and grow successful consumer ties. This concept was proposed during a service marketing conference. It was concluded that the ultimate goal of marketing for service firms is not only to obtain new clients but also to focus heavily on maintaining the ones they already have. Cooperative relationships are intended to benefit both parties over time (Dowell et al., 2015). The ultimate purpose of the collaboration is to achieve this. According to study findings, there are significant savings to be achieved by keeping an existing client base rather than recruiting new customers. Jackson developed the idea in the context of marketing (1985). According to him, the primary purpose of relationship marketing is to foster trust among consumers and company clients. According to research, relationship marketing is most effective when it focuses on maintaining current clients and keeping them interested in the product over time. This was revealed by further data analysis. The general public has embraced this research conclusion in the same manner as the underlying notion of relationship marketing. The study, on the other hand, concentrates entirely on the relationship with present customers, ignoring the dynamic changes in these clients over time. This is because new clientele produces recurring business. If a firm focuses solely on retaining its present client base, it will be unable to develop or compete in the market since it will be unable to attract new consumers who will use its products or services in the long run. From a social anthropological standpoint, the concept and practice of relationship marketing may be viewed as a commodities transaction that instrumentalizes elements of gift exchange. To put it another way, it’s a commodity transaction, Marketers have embraced a “pre-modern” style of interaction called reciprocity, whether or not it was done on design (Davies et al., 2010). The ultimate goal of the relationship marketing method is to develop a large client base. According to Liam Alvey, relationship marketing may be used when clients have a wide selection of competing goods and a continuing requirement for the product to utilize. According to relationship marketing research, one approach is to use one of three value techniques – the best

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pricing, greatest product, or finest service. Companies may elect to integrate value statements in their relationship marketing message as a result. Relationship marketing has gotten easier to adopt as new generations of customer relationship management systems have been developed. These systems track and evaluate every customer’s choices and activities. Customers’ preferences and financing methods, for example, may be utilized by a vehicle manufacturer having access to a comprehensive database of buy patterns and frequency, as well as preferences and financing methods, to adapt marketing offers and product benefits to each customer. This form of software is also often used in web-based applications (Crick & Crick, 2020). When a client makes an online purchase, a purchasing profile may be created for them to anticipate their future preferences. This is followed by various channels advising the customer of upcoming offers, such as crossselling and email suggestions. Direct mail is also becoming more popular in relationship marketing. Marketers may utilize variable data printing, which takes advantage of the technological advantages of digital, toner-based printing equipment to create unique, personalized things for each recipient. Using information from the company’s databases, a customer’s name and address, demographic information, and purchasing history may be utilized to customize the newspaper. They can also employ dozens to hundreds of other characteristics. As a result, the printed content is more relevant and likely to evoke a reaction from the target audience since it takes into account each recipient’s particular tastes and expectations. Relationship marketing is another business that has profited substantially from reengineering. Firms, according to process reengineering notions, should be structured based on the processes and activities that have been completed rather than their roles. Instead of being handed from one functional department to the next, the entire process should be handled by cross-functional teams. Traditional marketing, on the other hand, uses the “silo” system, in which each department is responsible for a certain element of the manufacturing process. Pricing, product management, promotion, and placement are the four components of the marketing mix in traditional marketing. According to Gordon, the marketing mix strategy does not provide an effective foundation for examining and building customer connections for a wide range of organizations (1999). Gordon, therefore, recommends the connection marketing alternative model (1999). Rather than focusing on

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markets and commodities, the alternative model of relationship marketing focuses on customers, relationships, and interactions through time (Chang et al., 2018). Relationship marketing, on the other hand, is not limited to a single department but rather relies on methods implemented throughout the organization. Some detractors prefer the term “relationship management” since relationship marketing encompasses a far larger range of operations than traditional marketing. Relationship marketing may be useful in several circumstances and a variety of ways. According to studies, relationship marketing is advantageous in both the for-profit and nonprofit sectors of the economy. According to the preceding section, RM has emerged as one of the most recent marketing fads and requires more examination. Terblanche contends that since the early 1990s, not enough research has been conducted to understand how consumers and markets interact with one another concerning RM. Articles on this relatively new issue should be addressed with caution, to establish it as a forward-thinking concept for long-term, mutually beneficial partnerships. Because the situation is still relatively new. According to Gronroos in his renowned and fundamental study, the approach is the established and rigorous strategy for managing customer interactions. Marketing was formerly a field where decision-making became increasingly scientific. He says this is because marketing was once a field where decision-making grew more scientific. He pushes for a more traditional strategy since it is more conventional, customer-centerd, and flexible (Cortez & Johnston, 2017). Hamer advocates a similar approach, emphasizing the need of finding a medium ground between the requirements of customers and those of service providers. Academics also disagree on the precise definition of RM and when the term first appeared. According to Ballantyne, the RM-concept 21 is a concept as old as marketing itself: building and sustaining strong social and professional ties with clients and dealers. The RM-concept 21 emphasizes the need of maintaining strong social and professional ties with consumers and dealers. When we examine the current corpus of literature, we discover that RM research has been going on for far longer than we were led to believe. Moller et al. employed this strategy. Given this, Gummesson believes that the RMphenomenon, rather than the term itself, should be

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debated. According to Harker et al., Berry was the first to create the phrase “relationship marketing” in 1983. Terblanche agrees, even though it is essentially a semantic exercise due to the somewhat earlier allusions to the basic concept and values that it supports. According to Ballantyne (2009:1), the concept of CRM emerged in the 1990s by combining elements of service marketing, total quality management (TQM), and greater knowledge of business connections. This occurred throughout the decade of the 1990s. According to Terblanche, it was viewed as the solution for all marketing problems at the time, and this thinking endures to this day. At this point in the twenty-first century, a significant difference emerged between two groups of researchers: those who feel that just the customer-supplier dyad should be studied, and others who believe in a more holistic view of various organizational linkages. This rift caused a significant divide in the business. According to Harker et al., many organizations create the idea that they have an RM strategy in place by executing RM plans that involve major transactional components. Even though such approaches fail to achieve their goals, they are nonetheless used. Consumer interest in RM is unlikely to result in long-term partnerships that benefit both parties. To address these shortcomings, this study will suggest a new technique dubbed “integrated customer experience management.” According to Veloutsou, RM emerged from services and business-to-business marketing, and the usual RM measurement approach incorporates some type of interaction between the firm and the customer (Chang et al., 2012). RM Veloutsou’s concept of “relationship management” centers on the management of interpersonal connections rather than interpersonal content. Because all businesses have typically maintained links with several stakeholders, Harker et al. whatever the case, it is clear that reaching a consensus on the origins and bounds of the RM will be difficult, if not impossible. Many academics and managers will struggle with RM for many years to come, and progress on the issue may take a very long time. This chapter has emphasized the need for an RM approach that stresses long-term and lucrative relationships with important customers after emphasizing the value of a long-term and profitable relationship with customers. This chapter also emphasizes the gradual move from a product-based to a customer-focused and service-driven marketing approach. According to Gummesson, the advancement of marketing in the preceding decades may have only been surpassed by the advancement of information technology. As a well-known RM specialist, he argues that

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attributing the emergence of RM to the expansion of information technology and global economic pressures and upheavals is incorrect (Claycomb et al., 2005). According to him, RM has always been a popular strategy for managers to adopt in some form or another. Although this hypothesis has been around for a long, the recent publication of studies has brought it to the general public’s attention. In any instance, the emphasis should be on developing profitable long-term relationships with loyal consumers who are pleased with the product or service. We’ll be OK as long as we keep this in mind. According to Yau and colleagues, customer-company interactions have long been regarded as excellent business practices all around the world. According to Baran et al., RM prioritizes long-term relationships and maintaining frequent touch with clients. As a result, the focus of relationship management (RM) has shifted from one-time transactions to ongoing engagement with clients. According to this notion, developing long-term connections with clients rather than depending solely on one-time walkin income might boost a company’s long-term survival and profitability. According to Bejou and colleagues, the word “customer experience” appears to have undergone more recent semantic changes than phrases such as “customer relationship management,” “database marketing,” “direct marketing,” or “customer loyalty.” According to Bejou et al., there are 28 distinct and uncoordinated perspectives on the RM-focus strategies for interpersonal connection and brand loyalty that are already in use. According to Rich, RM one-to-one should be evaluated because it is frequently referred to as being identical to RM. The two techniques they provide are as follows: Personalization is concerned with a specific set of people, whereas segmentation is concerned with a wider group of people that comprise the desired audience. The major focus of this study, however, will be connection marketing and client relationship management. As a consequence of this investigation, client experience management will be proved real.

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2.8. BRAND MANAGEMENT

Figure 2.8: Brand management Source: https://media.istockphoto.com/photos/digital-marketing-concept-online-advertisement-picture-id1284549946?b=1&k=20&m=1284549946&s= 170667a&w=0&h=DaMSS8u0nwYARehKE5DoEdjTPy96UQJ_B3LMRWnhBUY=

The activity of applying marketing methods to a single product, a whole line of products, or a single brand can be referred to as “brand management.” Brand equity and franchise value may both be improved by increasing consumer views of the product’s worth. A paradigm change in brand management has occurred over the past few decades, shifting from a customer-centric and business-focused approach to a more holistic perspective of the brand’s purpose and users, as well as the process of delivering value (Chang et al., 2018). This change has coincided with a movement toward a more comprehensive strategy for brand management. The stakeholder theory and the idea of service-dominant logic have received great support in the body of literature on brand management when it comes to the practice of identifying the meanings and values of a brand. The purpose of this chapter is to gain a comprehensive understanding of brand management by examining the recent fast expansion of the field. Brand value is the ultimate result of a dynamic and social process of co-creating brand meanings and functions, and this may be achieved by perceiving the brand as a conceptual construction resulting from interactions between the business and external stakeholders. This enables the attainment of the stated objective. Concerning current economic and competitive contests dominated

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by Web-based technologies and the accompanying interaction processes within a vast ecosystem of stakeholders, this conceptual chapter looks to analyze brand management’s current situation (Yang & Gabrielsson, 2017). To further our understanding of brand management, this conceptual chapter explores the roots of brand meaning and value. If you think about the brand in terms of a dynamic and social process, you’ll see that it has to be seen as a product that’s always changing and evolving. This is vital for conceiving a brand. To begin developing a brand, this criterion has to be met first. Customers and stakeholders are now able to interact with one another in virtual communities thanks to the social and technological environment. In these communities, the co-creation of brand value and its evacuation from the firm’s logic of origin is made feasible and intensified. We may use this as an example of how the macro-environment of society and technology can encourage creativity. Modern information and communication technologies, such as the World Wide Web, have made it possible for individuals from all over the world to connect in real-time, regardless of where they live or what time zone they’re in. As a consequence of the current literary and managerial landscape, modern brand management must overcome new challenges as compared to previous techniques. As a result, new managerial issues and decisions must be taken by businesses to function efficiently within the new environment. To provide a complete picture of the brand, including all sources of brand value as well as internal and external organizational components, this chapter is devoted to an in-depth investigation of these themes. A good example of this is: The following is an example of a situation in which this may be relevant: to go into further detail than that. As a result of these interactions, a business’s brand is conceptualized as a result of the brand’s value being co-created by its stakeholders (Wang et al., 2008). It is also important to underline the managerial choices made by each company from the standpoint of consumer marketing. The following two parts define the essential evolutionary guiding principles of brand management, which will be the focus of this chapter. A brand’s identity is formed when it is separated from the company’s products and services, resulting in a distinct identity for the brand. In the fourth part, the connection between stakeholder theory and brand management is explored, first from a theoretical viewpoint and then in terms of one of the most significant managerial consequences.

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2.9. CUSTOMERS ALONE AREN’T THE ONLY ONES AFFECTED BY A BRAND’S MANAGEMENT Customers’ associations with products and services are formed through a variety of cognitive, emotional, and relational processes, according to traditional marketing managers. These questions have been discussed for decades in marketing schools across the country. As a result, the traditional approach looks at the brand from the perspective of a two-way connection between the company and its customers. Thus, the company’s services or commodities contained not only tangible but also intangible parts of the brand as a result of this. There are however many who argue that the brand’s image may help customers recognize a product, give it a personality, and have an impact on their opinions. Additional research has shown that brand dimensions are a direct result of marketing managers’ efforts to build and maintain brand value. New paradigms in management challenges have emerged since the publication of Freeman’s first paper on the role of stakeholders in strategic management based on a new view of companies as linked with external interactions that are crucial to their survival and development. In light of a new picture of the firm as entwined in a network of external ties, these reevaluations have been made. While the firm-customer dyadic interaction is important in creating brand value, stakeholder theory shows that brand value is created through multiple linkages with all stakeholders (Wang et al., 2016). This is especially true when applying stakeholder theory to branding. The need to transcend the firm-customer dyadic relationship and create value for the brand can be demonstrated by applying stakeholder theory to brand management. As a result of the move from customer-focused logic to stakeholderfocused reasoning, the fundamental assumptions of branding theory have changed. Although marketing managers have traditionally viewed a brand as an object that can be controlled, stakeholder theory has changed the perception of the brand as a co-created product that can only be developed by interaction with many stakeholders. Stakeholder theory has had the most profound impact on our way of thinking. It is said that the brand is vulnerable to changes in social and cultural standards that are beyond the control of the brand manager. This would suggest that the associations between brands and their meanings are not the work of marketers.

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Customers are not passive recipients of brand meanings, but rather active co-creators; and brand value creation occurs in a more complex manner than the straightforward firm-customer relationship, as brand communities play a crucial role in the creation of identity-related meanings of a brand’s products. Similar observations must be made when it comes to the cocreation of brand value by stakeholders. Rather than existing as distinct and mutually exclusive entities, stakeholders interact with one another and with the organization as part of a web of interactions (Voola et al., 2022). Brand management rationale must be re-examined because this is a reality. The value of a brand is not limited to the one made for and seen just by customers, but includes the one established for—and perceived by—all stakeholders. When it comes to branding, it’s important to look at it from the perspective of collaboration and co-creation. From the outset, the brand is described as a notion distinct from the product or service and as a social process that emerges from interactions with several stakeholders. The brand’s long-term viability is aided by meanings that are personal, emotional, and societal.

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3

CHAPTER

DEVELOPING TESTING AND LAUNCHING NEW PRODUCTS AND SERVICES

CONTENTS

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3.1. Seven Stages in the New Product Development Process ................... 54 3.2. Importance of Strategic Product Launching ....................................... 63 3.3. How to Develop SMART Goals? ....................................................... 66 3.4. The Advantages of a New Product Launch ........................................ 68

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New product development is the process of turning a nebulous notion into a workable software application. A product launch is an introduction of a new product to the market by a firm. Certain marketing techniques rely on product releases to increase sales and attract a big number of buyers on the first day they are available. Product releases involve both new products and updates to current items. In today’s competitive market, businesses use every conceivable tactic to boost product sales as quickly as possible. The new product development (NPD) process includes determining what customers want and how they want it. Product Development is one of the six stages of the software development lifecycle, and it focuses on producing products with a proof of concept (POC) (Veloutsou & Taylor, 2012). The eventual objective of this strategy is to build an altogether new notion with no clue how it will be developed or whether it will be widely embraced.

Figure 3.1: Infographic template Source: https://media.istockphoto.com/vectors/startup-lifecycle-phases-vectorinfographic-template-vector-id1333631636?k=20&m=1333631636&s=612x6 12&w=0&h=UgSlvPr-rCWERpuVM9wY-DNKC-HPUo7e9nPm1-t5w-g=

3.1. SEVEN STAGES IN THE NEW PRODUCT DEVELOPMENT PROCESS There is usually an element of surprise involved in the development of new products and services. On the other side, New Product Development methods may assist businesses in developing clarity and trust in the goods they are developing (Theron et al., 2008).

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3.1.1. Idea Generation Create as many solid ideas as possible to serve as the foundation for your New Product Development strategy. The primary goal of stage one is to organize brainstorming sessions focused on client demands. At this stage, the goal is not to create ready-to-implement concepts. Instead, the emphasis should be on ideas that are still in the development stage and have yet to be tested. A company could do it this way: Concentrate on your customers’ requirements. When the problem is fully described, it is only partially solved. There are several methods for determining the problems of the target audience. a. worries about one’s own life Consider the issues that the company is currently dealing with when developing new concepts. A corporation only needs to focus on that one issue and come up with a “one-size-fits-all” solution to the national problem. When it comes to digital services, a company must first comprehend the human story that underpins them. For example, Twilio’s founder, Jeff Lawson, introduced the company’s communication-based software solution with an engrossing story. Before this one, he’d been involved in three failed ventures. As a result, he knew he needed to close the communication gaps before embarking on a new project, which he saw as the most significant impediment to its success. Twilio was born as a result of innovative product development at the time. Despite the ups and downs of manufacturing and marketing, it was his desire for the product that led to the creation of a fantastic business idea. To qualify, you must select one of the following challenges: This phase uses Michael Skok’s 4U methodology to determine whether the proposed solutions and/or fixes are valid. Delving deeper into each of these features may yield clearer results. Examine whether any of the product concepts generated will truly solve any problems. How well will the product meet the needs of its target market and close existing customer experience gaps? It is critical to consider whether the proposed solution is truly unavoidable in terms of compliance: It is critical to determine whether the problem must be resolved (Tuten & Urban, 2001). Urgency is a factor to consider if the problem is urgent and the target market requires an immediate solution. If the answer is “yes,” the original product may be able to fill the market gap. Is there a product on the market that addresses the problems that customers are currently experiencing? • Unsatisfied: Look for market inefficiencies and a promizing concept. Potential problem solutions: When you’ve identified a problem, it’s time to consider your options.

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Figure 3.2: Company homepage template Source: https://media.istockphoto.com/vectors/company-homepage-templatevector-id1060813726?k=20&m=1060813726&s=612x612&w=0&h=kJpD1K kIPGIP1UtV7S5nCYPUMlYr22_z2LzUMwS5RLo=

Every user concern should have the option of developing new products. Regardless of whether the problem is common or uncommon, the solution must be unique. Even if the product is similar to one that already exists, it should be evaluated to see if it can solve problems in a novel way. Zoom and Slack, for example, are both software as a service (SaaS) companies that encourage communication and collaboration. Zoom takes a unique approach by facilitating webinars. As a result, webinars are the company’s unique selling point (USP). Concentrating on Problems and Their Solutions Make a table of comparisons with all of the questions and answers from the shortlist in one place. By disseminating information throughout the organizational structure, you can create a collection of manageable concerns. Use the Replicate, Repurpose, and Upgrade approach if stakeholders aren’t on board with the chosen concept (Theron et al., 2008). This strategy’s goal is to develop a product that is similar to a competitor’s but available in a different geographical region. Unique and distinguishing features should be offered to grow a business after deploying the minimum viable product (MVP). This proposal seeks to “re-purpose” an existing business model to restructure it. LinkedIn Learning, for example, is an online educational platform for entrepreneurs. It was similar to a student e-learning platform, but it provided more opportunities for broadening the target market and demographic. This approach to new product development is centered on developing a new business model that outperforms current solutions. Improved can refer to a

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variety of things, including increased effectiveness, faster response times, overcoming a competitor’s challenges, or introducing new features.

3.1.2. Idea Screening This phase of new product development focuses on finding the concept with the best probability of success. Describe all accessible internal evaluation alternatives. For idea screening, for instance, you should look for employees with suitable industry expertise and experience. Creating a POC is the first stage in producing a new product idea since it determines whether the concept is realistic. Focusing on an idea that cannot be produced technically offers little purpose. Consult the Agile Development team for help. Their understanding may assist in recognizing the technical side of things, hence contributing to the selection of concepts deserving of a PoC. The SWOT (strengths, weaknesses, opportunities, and threats) analysis is another vital method to bear in mind while trimming down a list of probable new things (Theron & Terblanche, 2010). The Agile Development team, the product owner, the scrum master, and the product manager do a full investigation of the concept to pick one where the advantages and possibilities exceed the risks and faults. For clients to be ready to pay for newly made goods, the concept must be creative.

Figure 3.3: Product release illustration Source: https://media.istockphoto.com/vectors/product-release-icon-simpleelement-illustration-vector-id924915478?k=20&m=924915478&s=612x612 &w=0&h=AccO2oS9U8bppGRmdqqexvw1I3nm4AtWrIdE92yMwmw=

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3.1.3. Concept Development and Testing Before commencing with the New Product Development process, producing a thorough version of the idea and the user stories should be given priority. This value proposition evaluation is the starting step toward concept generation and testing. At the very least, it ensures that faults in the approach are detected sooner and the team may course-correct early. That helps to ensure that technical debts will not develop. The easy-to-follow concept development phases include:

1. Quantifying Gain/Pain Ratio: A corporation has to develop an educated image of the product from the user’s standpoint. This may be performed by determining the gain/pain ratio, where: Gain = Benefits of the product for the client. What is in it for them? Pain = The efforts made by the client to comprehend and use the product.

2. Conducting a Competitor Analysis: Knowing about current market participants is a vital strategic step to consider (Streukens et al., 2011). Understanding the competition makes it easy to infer: • • •

Where the opponent lacks Where is the space for improvement? Existing white space in the market

3. Enlisting the Major Product Features: The user stories presented in the New Product Development software project will make or break a firm. When building a list of such features, it is vital to know—how is it a creative feature, and how is it going to answer a problem?

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Figure 3.4: Startup and development of a product Source: https://media.istockphoto.com/vectors/-vector-id1138850853?k=20 &m=1138850853&s=612x612&w=0&h=FEbWc15MUB_a4gczETxT74tlrAR0UJ28vQeZEJgXvqw=

Creating a Value Proposition Chart Even after being convinced of the wisdom and the utility of thought, being able to articulate it successfully to the end-user, in their context, is quite a different story altogether. The end-user has to be offered a clear image of what the new product is capable of achieving.

Concept Testing Once the value proposition is established, it is time to offer it to the group of selected clients. How people view the notion is the test of the work thus far. If the concept doesn’t appear excellent, it is advisable to restart the idea screening techniques to generate a new product. Meaningful understanding may be attained by focusing on four important aspects:

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• • •

Identification of the focus group, i.e., persons who may profit from the new product under development. Assessment of alternative options that may be offered to the focus group. Development of a faultless strategy for the New Product Development that involves all stages from feature development, marketing, pricing, and distribution.

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Positioning of the product’s distinguishing qualities in the customers’ minds to boost findability and discoverability (Shaltoni & West, 2010).

3.1.4. Market Strategy/Business Analysis A marketing strategy must include a strategy for reaching the target audience. Using McCarthy’s 4Ps marketing strategy for a New Product Development project may be the most straightforward and effective method. To set a reasonable selling price for your goods, you must first understand the pricing structure of the product. The simplest method for calculating the basic cost is as follows: 1.

Pricing based on cost is an idea. The markup percentage is added to the initial manufacturing cost in this case to determine the final price of the new product. 2. Pricing by market conditions. This pricing is calculated by extrapolating the prices of similar products in the target market. Consider the following variables for competitive pricing: New Product Development operations that meet a client’s pressing need should be priced higher than the market. When entering a new market, it is best to price your new product similarly to your competitors (Sharma et al., 2010). To outperform the competition, marketing procedures must be improved. Although the new product may provide a unique solution, it is still recommended to offer a lower price range than competitors to attract customers who will become long-term customers.

3.1.5. Product Development Once the concept for new product development has been established, the market strategy has been documented, and the business analysis has been completed, the product life-cycle development process can begin.

3.1.6. Deployment When the MVP is finished, the emphasis shifts from product development to product launch in a real-world setting. The first two steps in this process are a CI/CD pipeline and a DevOps culture. The following are the stages of implementation: Here, new functionality is merged with existing functionality’s code.

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•

The quality assurance team tests the integrated code. Jenkins and other CI/CD tools run automated unit and sanity tests to ensure code quality. • Developers push software artifacts into the registry using Docker tools such as Gradle, Packer, AZK, and others. Currently in the Beta Stage Developers test new builds and their interactions with one another during this phase. • Manual testing to validate the new product’s overall performance and output efficacy, taking into account all possible input scenarios. When something is “pushed” into production, it is available to end users and ready to use (Sheth, 2020).

3.1.7. Market Entry/Commercialization The word “commercialization” covers several strategies aimed to assure the success of a new product. Commercialization entails the subsequent: If all of the aforementioned strategies are done flawlessly, nothing can stop a product from garnering attention and being a product-market fit. If you want your product to be successful, you must perform the following marketing tasks:

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1.

2.

Publicity Concerning the Product’s Concept: The key idea here is to stress the product’s concept and purpose rather than its qualities. Explain in a few sentences how the product will simplify the customer’s life. Initially, HubSpot, a marketing software, was not a popular product. Unfortunately, its consumers were unaware of the function of the now-popular device. So how precisely did they alter the game? They choose to focus on their unique selling proposition rather than marketing and promoting the overall product. This product’s distinguishing selling element was inbound marketing (Stein et al., 2013). As soon as they began to create awareness of inbound marketing, they were considered a pioneer in the software product area. Sometimes all it takes to draw buyers to a product is ideal marketing. Creating the voice of a brand with keen ears, unique perspectives, and opinions are regularly heard. The marketing people are crucial in this scenario. They must design a communication plan that successfully reflects the brand and is compelling. All of these components, including blogs, emails, and website information,

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must be succinct and well-planned. Lastly, these components must be able to grab the attention of the intended audience. 3. Organizing Interesting Webinars are one way for acquiring quality leads. Hold webinars to highlight the new product’s features and how the audience will benefit. Additionally, webinars can improve discoverability and usability: • Discoverability: When a user is aware of a feature, locating and utilizing it is simple. • Usability: Features that are unknown to the consumer are straightforward to identify and apply. As remote work gets more prevalent, webinars become a more effective approach to addressing a specific audience. Discuss the product’s virtues and watch the bottom line grow. There are several advantages to the new product development process. The advantages of adhering to the New Product Development process are as follows: Effectively responding to client demands while accelerating time to market and assisting in researching the idea’s technical viability. Increases success chance, eliminates a technical debt, enhances feature creep control, and minimizes opportunity costs.

Figure 3.5: Research illustration Source: https://media.istockphoto.com/vectors/market-research-isolated-concept-vector-illustrations-vector-id1403025890?k=20&m=1403025890&s=61 2x612&w=0&h=joQzqB0F2I6X8s9AXQFmIt8pEt1qJp3goeaSJ74ytMg=

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3.2. IMPORTANCE OF STRATEGIC PRODUCT LAUNCHING A product must be launched to attract potential buyers and get the market moving. Customers may become more interested in a new product when it is introduced. Consumers will learn about your company and possibly other products in addition to the new product. New product launches provide an excellent opportunity to convert potential customers into loyal customers. A well-executed product launch strategy may also aid in the growth of a company’s reputation. You demonstrate your appreciation for your customers’ feedback by developing a product that meets their requirements. As a result, they may like you and become your biggest fans. The greater the number of people who see your products, the more likely they are to buy them, resulting in increased revenue (Sivarajah et al., 2020). What elements should a product launch strategy include? Make sure your product launch strategy includes the following components: If you want customers to buy your products, you must create a product that they want or need. You will need to conduct market and consumer research to build your product and identify your ideal customer. After you’ve launched your product, your research will assist you in crafting the most effective marketing message possible. A small group of customers should test your product to ensure that you are on the right track. Testing can assist you in making improvements to your product as it is being developed. Step-by-step instructions for launching a new product (includes bonus tips) (other suggestions included). Developing a New Product Launch Strategy:

1. Conduct market research. As the first step in your marketing strategy, determine whether people are interested in your products. Consider your own company’s statistics to determine what your customers want. Examine your website’s bounce rate. A high bounce rate indicates that customers were unable to find the information they were looking for. Examine your sales data and compare it to the competition to see if your offer needs to be adjusted. Communicate with your clients. They are the most knowledgeable source of information. Propose testing and ask customers what they think of your current product or service and what changes they would make. Communication with customers has several advantages:

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It can assist you in understanding their selection criteria and why they chose you.

Figure 3.6: Startup banner Source: https://media.istockphoto.com/vectors/business-startup-banner-vector-id1335148052?k=20&m=1335148052&s=612x612&w=0&h=HW_6jKC wMMUPLejpTyp-YLmGar4WmLNUE2frQEqdKeI=

• •

It can assist you in understanding their language, which is useful for marketing. It may make you aware of aspects that customers use and enjoy, which can be used as selling points. Allow customers to voice their opinions in public. Ask open-ended questions and be willing to listen. Open a line of communication via email, chat, or phone so that customers who have purchased your items can explain their problems and receive customer service (Spyropoulou et al., 2010). Their feedback will not only help you build the product, but it will also help you test the customer’s reaction and plan a successful product launch.

2. Conduct market research. Look for comparable products in the market. Make a list of your competitors’ strengths and weaknesses, then do the same for your own company. Explain

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why customers would prefer your product over theirs when comparing the two. These significant differences are critical for the introduction of your product. Choose your ideal customer profile. Consider the following consumer targeting strategies to ensure a successful launch: • • • 3.

• • •

Determine the age, income level, interests, gender, location, and relationship status of the target client. If your business is B2B, describe the company size, specific difficulties, and buying cycle. Once you have defined your target, it is simple to develop a narrative that they can relate to. Establish specific objectives. Make a list of your objectives. Define success by expressing what you expect to happen if everything goes as planned. Here are a few examples of possible goals: Sales goals. Subscription information. Registrations related.

Figure 3.7: Brand name abstract Source: https://media.istockphoto.com/vectors/brand-name-abstract-conceptvector-illustration-vector-id1337408774?k=20&m=1337408774&s=612x612 &w=0&h=NYmu2BAUUx6qi_w9wIpiias3QPjITHu5f9DJkZYepPQ=

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3.3. HOW TO DEVELOP SMART GOALS? Compile a list of prospective partners, media, and affiliates. Make a list of companies and key people who can help you launch your product. Make a press release and contact any potential partners. Create a product launch strategy. Make a plan that includes a timeline and actionable steps. You may either use templates or create your own. Use symbols and colors to make your plan understandable so that staff can quickly scan and interpret it. The route plan must be accessible to multiple teams, including marketing for innovation and communication and engineering for product development and testing. Include them in the deadline-setting process to ensure that they are reasonable. The road map keeps you on track and assists you in planning everything for launch day, such as: • • •

preparing sales staff with training and other materials; preparing customer service staff for a potentially larger number of customers; and ensuring that the communications team is ready to deploy promotional materials.

a. Build a marketing website. Create a marketing page to which buyers will be directed on the launch day. Make it visually appealing and successful by incorporating customer feedback and developing a compelling story. Include the following criteria: • • tagline; • • solution; • • product key features; • • value proposition; • • user testimonials and quotes; • • a request for action. By discussing your product before its presentation, you create excitement and anticipation for it. On your website, include an email capture box where visitors can enter their email addresses. Keep them up to date on important product and event news. They could share their knowledge and help your launch succeed.

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b. Learn more about product marketing managers. Test your launch Simulate your launch date using your objective numbers to ensure that everyone on your team has enough time and resources to make it a success. Practicing may indicate that certain team members require additional training or that manufacturing methods must be adjusted to meet targets (Saura et al., 2021).

c. Suggestions for product introduction. For a successful product launch, follow the following guidelines: Encourage the spread of word-of-mouth (WOM). Focus on satisfied customers and encourage them to spread the word using specialized promotional materials. They might want to spread the word about how great the product is. Those people may seek to enjoy it themselves, thus extending the WOM cycle. Maintain an optimistic mindset. Target your target consumers with important messaging to capture their attention and maintain a pleasant experience. Sending them too many texts may put them off. Instead, give them items that add value and meet their needs. Users who have had a positive experience are more likely to provide positive feedback, which will help your product launch succeed. Begin with a small, targeted portion of the market and strive for ongoing development rather than investing significant effort in launching to a large audience for a short-term outcome. You can build prototypes to see which clients prefer, and you can test marketing concepts to find the most effective messaging. Before progressing, this technique relies on validation. The target audience is more likely to recommend your product and share their feedback, attracting new customers and reinforcing the growth mechanism. Make use of preorders. You can sell your product to early adopters before it is officially released. This method may help you validate your pricing strategy and build a community. Offering discounts to your first customers or releasing a limited supply may help create a sense of urgency, which can boost your early sales. As a result, a company spends a significant amount of time planning the launch of a product, and a series of events are planned to create the product’s big release (Rusthollkarhu et al., 2022). A product launch is made up of several components. Let us learn about them individually. (i) A marketing positioning and messaging phrase that has been determined. (ii) Product features and capabilities that correspond to current marketing requirements. (iii) The product launch must leave a lasting impression. (iv) Predetermined goals for the product’s introduction. (v) The precise and planned launch time.

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Figure 3.8: Flat line design Source: https://media.istockphoto.com/vectors/flat-line-design-illustration-ofproject-startup-process-vector-id492286300?k=20&m=492286300&s=612x6 12&w=0&h=4c3iZ5J5iDvD2a2iUeVLBxlD0tthCNhbVoEIpXBc7CQ=

These qualities are essential for a successful product launch. You must plan and work on your products before releasing them to the market. In today’s competitive environment, companies will spend a million dollars on the launch of a product to capture customers’ attention and generate the most sales in the product’s first few months on the market. A new or updated version of an existing product can be joyfully launched into the market through a product launch event.

3.4. THE ADVANTAGES OFA NEW PRODUCT LAUNCH Manufacturing and marketing campaigns begin after a company has developed a product concept, tested it on the market, and determined that it is ready for launch. To have a successful product launch, you must spread the word and encourage people to buy your products. The benefits of the product to your business become clear as soon as it is delivered. Every new product that is to be a market success must be accompanied by an exciting product launch. In reality, the majority of successful business executives will tell you that the most critical stage of the product development process is product launch. As a result, these business geniuses devote an entire marketing team to the launch, ensuring that the team is fully supported and methodically preparing for every element. Despite the obvious need for product launch

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marketing, more than 60% of businesses today do not prioritize their product launch preparations sufficiently (Rosenbloom & Larsen, 2003). Even after spending millions of dollars on product development, businesses can afford to make mistakes at the most critical time. This is an excellent opportunity to show your clientele that you value their opinions. This trust and regard will earn you a fantastic reputation in your community.

Figure 3.9: Flat poster motivating Source: https://media.istockphoto.com/vectors/flat-poster-motivating-on-hardwork-for-big-dream-vector-id1214002494?k=20&m=1214002494&s=612x61 2&w=0&h=oIeyQ5oADyV2Yi4WmQ5SYKhpqqYZqIsGQbco8acHtgU=

1. Attracting the client’s attention. Even if your product is on store shelves, consumers will be skeptical if they haven’t seen or heard of it.” A successful product launch highlights not only the new product but also the company and its existing items to customers. This is an excellent opportunity to define your company’s history and communicate to potential customers what your brand represents. Therefore, even if they do not purchase the product you are offering, they may wind up choosing another of your items, according to Diceus analysts. If you could find a method to add a link to your website in the launch advertising, whether they are online or offline, you can be guaranteed that your website will get

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new visitors that you can easily convert into loyal clients (Rosenbloom, 2007). Furthermore, the greater your website’s internet traffic, the higher it ranks on Google and the more visible it is. It is a complete success. New business opportunities Investors may be interested in your company depending on the success of your launch. Some may be impressed by the product’s success after its initial release and offer to buy a stake in your company. Others will be surprised by your ability to organize a following of dedicated clients, and because they want to benefit from your expertise, they will offer you a plethora of partnership opportunities. There are also significant firms in your field that would offer you a lucrative executive position in exchange for purchasing your company. Nobody knows who is watching.

2. Increased revenue. The larger your customer base, commercial partnerships, and company exposure, the greater your revenue. Successful product launches frequently return their initial investment faster than those that completely disregard it. When launching a new product, try out new marketing channels like website advertising, mobile phone distribution, and social networking site announcements. Your new product may attract customers from unexpected places, increasing your revenue streams. Gaining market share: You can increase your market competitiveness by developing a new product. Even if a similar product already exists on the market, you can use your product’s uniqueness and excitement to attract customers. You can increase your market share by attracting first-time buyers who become loyal customers. Employee Retention and Motivation The work is more interesting when it is novel. A new product launch necessitates new goals, processes, and communication channels for employees. If you inform employees that your company is expanding, busy, and offering new projects, you are more likely to retain them (Backhaus et al., 2011). The marketing plan and its execution are components of the market launch, which takes place after the product or service is released and ensures that the product reaches its intended market. A new brand must be introduced to the market and positioned differently. This is known as a brand launch. A successful product launch provides the following benefits: 1. Make Information Available Using articles, events, and promotional activities to launch a product or brand ensures that the

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campaign is recognized and that customers are aware of the offering. As a result, the consumer base and revenues may expand.

3. Organization and personnel. The soft launch may indicate the techniques to be used, the people and resources required, as well as the training and preparation required to manage the product once it is made available to the general public. You can raise awareness, generate enthusiasm, and confirm your product’s positioning with the help of an effective product launch plan. The journey, however, is not linear. The most successful product launches consider the product lifecycle, determining how to transition from one phase to the next and how the product fits into the overall picture. This article will demonstrate how to create a product launch strategy that can support a nonlinear journey. We will also discuss when to enter the product lifecycle’s growth stage so that you can capitalize on your momentum to increase conversions and revenue. (Would you like to be more productive at product launches? Take the course to become certified in product marketing. Consider your product launch to be a stage in the product lifecycle, allowing for a nonlinear journey.

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The traditional product lifecycle is divided into four stages: •

• •

•

Introduction: Your marketing goals may include generating interest in your product while it is still in development and encouraging people to sign up and buy. Rapid expansion of revenue and user base. You are introducing new product features to compete in the market. Maturity: The moment at which your product is the most commonly utilized and lucrative. The main priority here is to protect income and market position. Autumn: Revenue and new user registrations start to fall. Here, you should try to persuade hesitant customers to buy and look into alternative revenue streams. The majority of a product launch’s time is spent in the introduction phase (transitioning into growth once sufficient demand is generated). However, there are several strategies for transitioning from introduction to growth (and beyond). This way of thinking is far too limited (Ritter & Pedersen, 2020). Knowing how your launch plan fits into the bigger picture will help you identify the following:

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How to raise awareness in the early stages (this method will vary reliant on product kind, industry, target demography, etc. (This strategy will differ depending on the product, industry, target demographic, and so on.). • How much time you should spend on each step to achieve your goals, as well as when to switch between phases (e.g., X booked demos in the introduction stage, x revenue in the growth stage. Without a strategy, you risk meeting your goal of 100 demos for introduction but failing to know how to convert “testers” into “subscribers” to generate, say, $50 per user per month in recurring income. This document will establish your go-to-market (GtM) strategy, which should include the following elements: • Market dynamics and competitive positioning. • Product offering and pricing procedure. • Lead generation and client acquisition procedure. Using these guidelines, you can choose a GtM strategy that will grow your customer base through acquisition, retention, and expansion. A product launch strategy for attracting buyers’ attention and developing brand recognition. A well-executed product launch strategy increases brand recognition and encourages product growth. However, this is only true if your items are exposed to the right audience at the right time. Many business owners believe that if they provide an excellent product or service, people will flock to them. This is not always the case. Instead, create a product that meets market demand (and provides the intended experience and truly delivers the experience customers desire). The launch strategy should elicit excitement and anticipation, as well as match the demands and preferences of the target audience (as defined by market research and customer feedback) (based on product research and feedback). If it fails, try again and adjust your product positioning until it succeeds. According to this article, you created a product with unique features that improve the lives of your users. It also implies that you have investigated the feasibility of your concept and conducted a preliminary interest test. These criteria are costly in terms of time, effort, money, and resources. The launch of your new product will fail if you do not follow the proper strategy. In the first stage, create pre-launch materials that improve your messaging and inspire employee buy-in. Pre-launch paperwork ensures that all stakeholders agree before you begin distributing your product. To persuade customers to buy, download, or sign up, your team must be knowledgeable and confident

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in what they are selling (Pires & Aisbett, 2003). Regardless of the size of your company or organization, there are a variety of papers you can create before launch to encourage buy-in. Sales messaging guide Create a sales message guide to ensure consistency in how your team offers the product, emphasizes its benefits, and distinguishes it from competitors. Even if you are not using a sales-led GtM approach, you must understand how to position and respond to inbound leads. Consider the customer’s point of view first to ensure that the message is understood. Be conscious that your product may be seen differently than you have discussed with your colleagues. This is a benefit because you aren’t marketing it to yourself. Consider how the product will be perceived, how its attributes will be described, and how the product’s value will be stressed. In the absence of customer feedback, the sales pitch will lack consumer opinions and insights.

Figure 3.10: Business agreement launch Source: https://media.istockphoto.com/vectors/business-agreement-for-launching-new-product-vector-id1203872857?k=20&m=1203872857&s=612x612& w=0&h=Onz4DJlBxADLQiUvLnwjVk33HS7kwcuJ0bn5A-PVKOA=

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A lack of engagement and enthusiasm from your leads may lead to low levels of interest and poor conversions if your team lacks it. Make adjustments to your message based on how the audience responds. A distinct section focuses on testing, analyzing, and upgrading communications. To better understand how the product is viewed by the end user, try producing an internal press release. Your team may make modifications to the product’s messaging with the aid of an internal press release. Identify the major challenges the product seeks to address, explain the technique by which it does this (or how it improves on earlier solutions), and show how it improves the lives of consumers. Following are some things to bear in mind: As to why someone might be afraid, What are the product’s advantages to consumers? Why is this decision better than the other ones that are now available? Make modifications to the internal press release if it doesn’t attract your attention right away. A quick and low-cost way to figure out how to effectively express your content is to work backward from a press release (Baumgarth & Schmidt, 2010). Conduct user and competitor research to learn about the customer experience. You may spark interest, present engaging product stories, and move the target market from awareness to consideration by undertaking thorough competition and user research. Analyzing the demands of end consumers after completing user research to understand the customer’s experience, you’ll need to undertake some user research. As an example, establishing whether or not your product is understood may be done using this technique (or not). If your product’s user experience (UX) satisfies or falls short of client needs (or if it misses the mark). For example, if users routinely click “see more,” it may be good to lengthen the text fragment so that natural user behavior may be accommodated (for instance, if they constantly click “see more,” enlarging the text snippet may be desirable to meet natural user behavior). If an MVP is already in use, user research is only beneficial. Soliciting user feedback on a subpar product is a waste of time and money. What types of questions should be asked during user research? When you first encounter this product or feature, what is your immediate impression? What are your hopes for this product or feature? Is there anything about this product that makes you think of something you’ve previously used? Please notify us if you have any questions or concerns about this product. Information gleaned from responses can indicate a lot about the people who give them (Naudé et al., 2009). If your target audience is varied, you’ll need to design various user personas to properly target your messaging. The

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results of user research will expose the contrasts between what people expect and what they get. If your product or feature doesn’t meet expectations or fulfill intent, you can update your messaging (along with your product or feature). When obtaining consumer insights, be sure you record the “voice of the customer” (VoC) data. VOC allows you to collect qualitative and quantitative data on your customers’ wants, desires, pain areas, and hesitations regarding your product. You may improve your relationship with your audience and increase sales by writing in the language of your target audience. A service like Wynter allows you to undertake message testing and gather statistics on a given website, advertising, or email. To learn about your client’s goals, the environment, and any social or emotional attachments they may have built with the task, focus on Jobs-to-Be-Done (JTBD) research. Analyze your rivals. A thorough investigation of the competition may help you detect market trends, fix user experience gaps, and boost sales of your products. Take notice of their price structure, delivery fees, and any other bonuses or perks they may give. Analyze their approach to content marketing, sales strategies, and other means of outreach. Look at how active they are on social media and what their preferences are for sites. These suggestions could help you win the consumer war and achieve a competitive advantage.

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4

CHAPTER

MANAGING PRODUCTS THROUGH THEIR PRODUCT LIFE CYCLE

CONTENTS

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4.1. A Clear Explanation of Product Lifecycle Management (PLM) ........... 78 4.2. The Benefits of Product Lifecycle Management ................................. 79 4.3. A Brief History of Product Lifecycle Management (PLM) ................... 79 4.4. Product Life Cycle Stages .................................................................. 81 4.5. Stages of the Product Life Cycle ........................................................ 82 4.6. Product Life Cycle Scenarios............................................................. 86 4.7. A System of Artificial Intelligence (AI) ............................................... 88 4.8. Use of the Product’s Entire Life Cycle ................................................ 89 4.9. Product Lifecycle Influences ............................................................. 90 4.10. Advances in Technology.................................................................. 91 4.11. Money’s Forces ............................................................................... 91 4.12. Conducting Market Research to Assist With a Product Launch ........ 92 4.13. Market Development ...................................................................... 94 4.14. Market Introduction ........................................................................ 96 4.15. Difficulties in the Initial Phase ........................................................ 96 4.16. Product Lifecycle Administration .................................................... 97 4.17. The Factors Influencing Market Growth ........................................... 99 4.18. Maturity ........................................................................................ 100 4.19. Positive Qualities of the Mature Stage ........................................... 101 4.20. Market Decline ............................................................................. 102 4.21. Product Lifecycle Administration .................................................. 103 4.22. Importance of the Product Life Cycle ............................................ 103

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Product lifecycle management (PLM) is the activity of monitoring a product’s creation, launch, growth, maturity/stability, and death at all stages of its existence. Product management includes both manufacturing and promotion. The concept of the product life cycle may be important for making business choices, from pricing and promotion to growth and costcutting. PLM refers to an organization’s approach to managing all elements of a product’s lifespan, from creation through obsolescence (PLM). A PLM system manages a product’s whole lifespan, from conception and production through marketing and consumer segmentation (Michaelidou et al., 2011). Product development cycles are shortened with PLM, manufacturing process scaling up or down is suggested, and marketing activities are directed appropriately.

4.1. A CLEAR EXPLANATION OF PRODUCT LIFECYCLE MANAGEMENT (PLM) Good product life cycle management aims to create a product that outperforms the competition is extremely lucrative and lasts as long as customer demand and technology capabilities allow. It accomplishes this by streamlining the actions of the different firms, departments, and individuals involved in the product’s creation. It requires much more than merely assembling a list of components (BOM).

Figure 4.1: A blackboard written product life cycle Source: https://www.istockphoto.com/photo/product-life-cycle-chart-on-blackboard-gm172447836–23696955?phrase=product%20life%20cycle

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PLM solutions assist businesses in dealing with the increasing complexity of product development and the resulting technological difficulties. The other three pillars of a manufacturing company’s information technology system are customer relationship management (CRM), supplier relationships, and corporate resources, while supply chain management is the fourth (enterprise resource planning [ERP]). The stage of a product’s life cycle determines its marketing strategy. A new product, for example, demands an explanation, but an established product necessitates distinctiveness. PLM influences a product’s basic base. Even after a product has matured, it can still alter, particularly if it is upgraded or updated (Möller & Parvinen, 2015).

4.2. THE BENEFITS OF PRODUCT LIFECYCLE MANAGEMENT A well-managed product lifecycle has several benefits, including a faster time to market, a higher-quality final product, greater product safety, increased income potential, and a decrease in errors and waste. PLM software may help with document management, design integration, and process management. This is another benefit: • • • • • • • • • •

increased product resilience and consistency; lower-cost prototyping; Requests for quotations (RFQs) and supplier solicitations that are timely and thorough; Quickly identifying potential income streams and sales prospects; Money was saved by reusing the original data; A strategy for increasing product quality; Waste is reduced; improved ability to manage seasonal fluctuations; lower material costs as a result of improved planning; The greatest level of supply chain collaboration.

4.3. A BRIEF HISTORY OF PRODUCT LIFECYCLE MANAGEMENT (PLM) It wasn’t until 1931 that the concept of several life cycles was introduced. In 1957, a Booz Allen Hamilton employee developed a five-stage life cycle for

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commodities, starting with the introduction and proceeding through growth, maturity, saturation, and decline (Bendixen et al., 2004). PLM was developed as a production and marketing tool to get the competitive advantage of being the first to market new products. In 1985, American Motors Corporation (AMC) was among the first corporations to embrace PLM. AMC decided in 1985 to prioritize the product lifespan of its flagship vehicles to compete more successfully with larger rivals despite their superior resources (particularly jeeps). Following the introduction of the little Jeep Cherokee, AMC began production of the Jeep Grand Cherokee as part of this strategy, which aided in the development of the modern sport utility vehicle (SUV) market. The introduction of computer-aided design (CAD) software tools, which enhanced engineer productivity, was the first stage in the company’s effort to speed up product development. This project required the development of a new communication system that avoided costly technical changes and accelerated the process of conflict resolution by storing all drawings and documents in a single database.

Figure 4.2: An infographic on a product and its processes Source: https://www.istockphoto.com/vector/product-maintenance-vector-infographic-template-gm1269838176–373017256?phrase=product%20life%20 cycle

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Following Chrysler’s acquisition of AMC, a system for handling product data was implemented across the whole organization, integrating everyone involved in product development. By the mid-1990s, Chrysler’s manufacturing costs were the lowest in the automobile industry due to the use of PLM technology.

4.4. PRODUCT LIFE CYCLE STAGES Every year, hundreds of millions of things are purchased. Like ourselves, these creatures go through a life cycle. Outdated things eventually lose their attractiveness, but newer, more cutting-edge items are usually in high demand right away (Biemans et al., 2010). Because it is common knowledge that items have a finite shelf life, most businesses dedicate substantial efforts to producing new products to guarantee that their businesses continue to expand.

4.4.1. Description of the Product Lifecycle Stages When a firm manages its product life cycle, each stage brings a new set of difficulties and potential for growth. If your company is releasing a new product, this will most likely be the most expensive phase. Because of the product’s small market share, sales are likely to increase in the future. If the market is competitive and the product must be released, consumer testing and marketing expenditures may be high. During a company’s expansion period, sales and earnings often skyrocket. Profit margins and total earnings will improve as a result of the company’s ability to use economies of scale in production. As a consequence, businesses may raise their promotional spending, allowing them to make the most of this early period of product development. When a product has matured, the manufacturer’s objective is to retain its market share. To distinguish in today’s market, businesses must employ savvy marketing methods. They should also consider any changes to their product or procedures that might provide them a competitive advantage (Chang et al., 2018). This is the moment at which the market for a product begins to contract. Customers may have switched to a different product category, or the market

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may have become saturated, resulting in decreased sales (all potential buyers have already made purchases of the product). Even if this decrease is unavoidable, businesses can still turn a profit by shifting to less expensive manufacturing methods and markets.

4.4.1. Description of the Product Lifecycle Stages 4.4.2. Illustrations Depicting a Product’s Life Cycle A variety of products could be used as examples to better demonstrate the various stages of the product life cycle. The stages for each technique are as follows, along with an example of how to watch recorded TV: • three-dimensional TVs; • digital video recorders and Blu-ray discs; • the DVD’s maturity; • disappointment is a form of rejection. Product lifecycle management (PLM) is a well-known concept that manufacturers must understand to remain viable and successful (Claycomb et al., 2005). It is critical to have a thorough understanding of this life cycle to ensure effective production. The key, however, is proactive commodity management at various stages of the cycle, using the necessary resources and sales and marketing methods.

4.5. STAGES OF THE PRODUCT LIFE CYCLE Each stage of a product’s life cycle is given its name and identifier. Market research is carried out at each stage of a product’s life cycle. SurveyMonkey’s comprehensive market research guide may help you better understand the value of market research in managing your product’s life cycle. There is no standardized timeline for the entire process, even though the length of each stage varies from product to product. Each stage of the life cycle has its own set of expenses, risks, and opportunities, so your strategy must be adjusted accordingly.

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Figure 4.3: A graph of sales volume against the product life cycle Source: https://www.istockphoto.com/photo/management-traditional-productlife-cycle-gm621895738–108730391?phrase=product%20life%20cycle

4.5.1. Market Expansion The first step in the product lifecycle is development. This is your first introduction to market research. Before releasing your product to the public, you’ll need to work on refining your concept, conducting product testing, and developing a launch strategy (Chang et al., 2012). Client testing of the concept is critical at this stage. You may make changes to your concept before beginning production based on feedback from your target audience. You will spend a lot of money developing this new product, but you will not receive any compensation. You can either fund this phase on your own or find investors. In any case, the stakes are high, and outside investment is usually scarce. Market research can be done in a variety of ways, from brainstorming to developing a working prototype. It is sufficient to convey your message to potential customers and investors. If you can demonstrate early market potential, you’ll be able to start raising funds for your launch.

4.5.2. The Public Presentation of the Product The introduction phase of the product lifecycle begins when a new product is introduced to the market. The first goal of your marketing team will be

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to reach your target market and raise awareness of your product. When it comes to product promotion, inbound marketing, and content marketing are essentially interchangeable (Möller & Halinen, 2018). If your product is complicated, there is a lot of competition, your idea is unique, or other factors come into play, you may need to spend more time here than you anticipated. It’s fantastic news that if your marketing is successful, you can advance to the next level of growth. At this point in its life cycle, customers have embraced and continue to support the product. As demand and earnings rise, competitors try to sabotage your success (Cortez & Johnston, 2017). During this stage, marketing shifts from customer acquisition to brand development. Make the most of your distinct advantage over your competitors. As a company grows, its support staff, customer service, and distribution channels may all expand concurrently. All of these initiatives will be prominently featured in all of your future marketing campaigns.

4.5.3. Trustworthiness When sales begin to stabilize after a period of rapid growth, you enter the mature stage. You may have to reduce your prices to stay in business. Your advertising campaigns will stand out from the crowd by emphasizing your product’s unique selling points. Sales are stable, and manufacturing costs are decreasing. As tempting as it may be to rest on your laurels and enjoy a steady stream of sales, you must continue your good work and communicate this to your customers. The market may be saturated at this time. The number of competitors in the market has increased. Even if the product is widely used, the market is saturated with alternatives. Your advantages—distinction, features, brand recognition, pricing, and customer service—will assist you in resolving this issue and positioning your company as the best option. If you don’t, your health will deteriorate. Given price sensitivity and the Van Westendorp research, the maturity of your product may necessitate a reevaluation of its pricing. If this is the case, please contact our sales team.

4.5.4. Market Deterioration If your brand isn’t as well-known as others on the market, it’s time to move on to the final step. More powerful competitors will emerge in the future to

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take your market share. As a result of increased competition, sales are likely to fall (Mudambi, 2002). • There is a lot of competition from comparable products. If you want to succeed in today’s market, you must differentiate your products from the competition. The arrival of Facebook as a social media platform resulted in the demise of MySpace. • The product has been phased out or replaced. You may find yourself in this situation if your product has reached its maximum potential and is no longer marketable. VHS tapes reached this level of popularity when DVDs were introduced, and DVDs are now on the verge of reaching this level as streaming media becomes more popular. Blockbuster, the country’s largest video store, had a terrible day.

Figure 4.4: Factors affecting product life cycle Source: https://www.istockphoto.com/photo/product-life-cycle-gm188012545– 29867894?phrase=product%20life%20cycle

• Consumer excitement has waned. Heinz, a condiment and sauce manufacturer, introduced EZ Squirt ketchup in 2000. The product failed to gain traction after the novelty wore off. • Harmed the reputation of the company. The release of a documentary examining the effects of McDonald’s cuisine on general health dealt a blow to McDonald’s fast food restaurants’ supersize menu.

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When a company’s market share falls, it may decide to discontinue a product, sell the company, or reinvent an existing product. You can use nostalgia or the superiority of your product as marketing tools to extend the life of your product (Mejri et al., 2018). Companies that are emerging from a market slump may look for new ways to grow. In terms of product variety, Cherry Vanilla and other flavors will be added, similar to Coca-Cola and Pepsi. Repackaging the product is an option, as it was with Listerine, which was once a surgical antiseptic. Listerine is now sold as an anti-halitosis mouthwash. As Dollar Shave Club has done with innovative pricing strategies. Subscription pricing and pricing based on the number of blades in each razor are used by the company (Chang et al., 2018). To maintain the product’s popularity, new versions are released, as Apple does with each new iPhone release. To expand into new product categories, it is frequently necessary to return to the beginning of the product life cycle. Nintendo is an excellent example of this. They transitioned from developing video arcade games to developing video games for personal computers.

4.6. PRODUCT LIFE CYCLE SCENARIOS Some items, however, have already passed their expiration date and have been discarded. Here are some examples of products that are currently in use or have been discontinued.

4.6.1. Typewriters Christopher Latham Sholes of Milwaukee, Wisconsin, invented the first typewriter in 1868. Inventors have been experimenting with it for over three centuries. When commercial typewriters were made available to the general public in the late 1800s, the introduction phase of the product life cycle began.

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Figure 4.5: A graph of money this to time Source: https://www.istockphoto.com/photo/product-life-cycle-gm524776047– 51693356?phrase=product%20life%20cycle

Following that, typewriters were widely used in households, businesses, and offices throughout the industry’s expansion era. Typewriters were pushed out of production by newer technology until the 1980s.The typewriter industry has imploded. Computers, tablet computers, and cellphones have largely replaced typewriters in the workplace. Typewriters on the market today are mostly novelty items and historical relics.

4.6.2. VCRs VCRs were invented in the 1950s to watch VHS recordings from recorded television. The desk-sized first real prototype cost about $50,000 (about $500,000 today) when it was built in 1950, which is roughly half of what it would cost today. All of this is required to save television shows for later viewing. The first VCR for recording and replaying video on television screens was released to the public in 1977. From the late 1970s to the early 2000s, many homes had a VCR and an abundance of cassettes. There is no denying that we are living in a time of rapid growth (Leek & Christodoulides, 2011).

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As the VCR matured, companies sought ways to reduce prices while expanding functionality.

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As technology advanced, the VCR was eventually replaced by DVDs, which are now available through streaming services.

4.6.3. Vehicles That Run Entirely On Electricity Electric cars were invented for the first time in the early nineteenth century. Customers disliked them because they were difficult to charge. Take a forward step into the future. Tesla and other automakers are concentrating their efforts on electric and hybrid vehicle options. When these products were first introduced to the market, the primary marketing messages were innovation and environmental friendliness. The market for electric vehicles is currently expanding as companies work to improve the appearance and feel of their vehicles. The growth stage is extended due to the market’s constant innovation, which increases the product’s sales potential. They are still growing and have not reached full maturity.

4.7. A SYSTEM OF ARTIFICIAL INTELLIGENCE (AI) Artificial intelligence was first conceived in the 1950s, but the cost was prohibitively expensive for the majority of corporations. In the 1970s, better and more affordable computers were developed. Deep Blue, IBM’s chessplaying computer program, defeated world chess champion, Gary Kasparov, in 1997, providing a significant proof of concept (Lim, 2018). The product life cycle includes a variety of AI-based products. Because of the diverse applications that AI can serve, it is difficult to categorize it into a single stage of development. For example, Amazon’s Alexa is in its growth phase, whereas many other products are still in the introduction phase. How can you tell if your products are nearing completion? Each product progresses through the phases at a different rate. The amount of time a product spends in each stage is not fixed; it could be measured in days or years. Each stage has its distinct characteristics, and it is frequently easier to identify the next step by looking back at the previous one.

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Figure 4.6: An infographic showing the product lifecycle management Source: https://www.istockphoto.com/vector/plm-product-lifecycle-management-concept-with-keywords-letters-and-icons-flat-gm1124701551– 295358512?phrase=product%20life%20cycle

Having this foresight allows you to make improvements that will extend the value of your product or delay its aging or depreciation. Analyze your current stage of growth, sales patterns, competition, and price using market research tools.

4.8. USE OF THE PRODUCT’S ENTIRE LIFE CYCLE 1. The first step is to establish market credibility. At this point, you’ll be promoting your product as being the best in its category, whether that’s the best value for money, the most luxurious, or any other benefit you choose to highlight. The goal is to make your products stand out from the competition and establish your brand as the industry’s dominant player.

2. Create a pricing strategy. As a product matures, so will your pricing strategies. With an introductory price, one hopes to set themselves apart from the competition. For example, new features and advantages may necessitate a price increase or decrease over time (Lambert & Enz, 2012). Competitive pricing may eventually lead to lower prices as the market matures. There is almost always a reduction in prices or a return to the beginning of the decline.

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3. Create a strategic marketing plan that works. What you sell has a direct impact on how well your product works. Every stage of a product’s lifecycle is an opportunity to learn and improve your marketing strategy. As you move through the beginning stages of your campaign, you’ll be looking for new ways to reach out to your target demographic. Expansion means using high-quality content to establish connections on the networks you prefer. It’s possible to extend the decline by utilizing new channels, messages, and other tactics as you mature.

4.9. PRODUCT LIFECYCLE INFLUENCES Even if you have internal control over your product’s concept, positioning, and marketing efforts, external factors can still have an impact on its overall lifespan.

4.9.1. Affordability You’re about to enter a highly competitive field. Your product’s success may be directly influenced by your competitors. Your product’s life cycle may be shortened if the market is small, competition is low, costs are low, and other entry barriers are low (LaPlaca, 2013). Admission may be more difficult, but your lifespan is likely to be longer if these variables are greater.

Figure 4.7: A graph of sales against time Source: https://www.istockphoto.com/vector/product-life-cycle-chart-on-whitebackground-gm185428669–27892378?phrase=product%20life%20cycle

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4.10. ADVANCES IN TECHNOLOGY Your product will likely have a short shelf life if it is in a rapidly evolving technological field (such as, mobile phones, tablets, or computers). This means that you must be aware of how quickly technology advances, what changes your target market wants, and when your product must be updated so that it remains relevant. The rate at which a product or service is accepted by consumers. The rate of client acceptance is another factor that influences the product’s life cycle. Examine the lifespans of similar things to get an idea of how popular yours will be. Market research may be used to forecast a product’s acceptability and adoption timeline (Crick & Crick, 2020).

4.11. MONEY’S FORCES The state of the economy can have an impact on product life cycles. Let’s examine more closely at this epidemic. People spent less money or were choosier about what they bought, extending the introduction phase of new things. Due to increased consumer spending, a strong economy can both shorten the start-up stage and lengthen the growth phase. Economic difficulties might have a big influence on your product, target market, and industry.

Figure 4.8: A representation of the growth in the section such as plants Source: https://www.istockphoto.com/photo/product-life-cycle-gm1132190535– 300035596?phrase=product%20life%20cycle

Market research is carried out throughout the lifespan of a product. Regardless matter the sort of product you offer, market research will be

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required at some point during its existence. If you study, you will have a higher chance of success. To help in the formation of a market you should investigate the current market for your product, the target market, who would buy it and why, the viability of the concept, and the competition while producing a product. SurveyMonkey offers several options for doing research in the following ways: • • • • •

Market sizing assists in determining the size of your product’s market. Competitive intelligence refers to market research about your competitors’ products and services. You may better focus your advertising and marketing activities by using data on customer segments (Davies et al., 2010). With Usage and Attitudes, you may improve your market understanding and potential for development. Concept testing allows you to assess the feasibility of your product concept in the presence of actual customers.

4.12. CONDUCTING MARKET RESEARCH TO ASSIST WITH A PRODUCT LAUNCH Determine which advertising themes resonate with your target demographic, validate any product claims, and gather feedback from early adopters throughout this stage of your product’s life cycle. With the aid of this study, you can prepare for the growing season. • •

•

Messaging and claims testing evaluates the effectiveness of your message and verifies product claims. Ad testing evaluates the effectiveness of online advertising, websites, and a variety of other factors (LaPlaca & Katrichis, 2009). You may utilize customer feedback to determine the level of demand for your product or service.

4.12.1. A Market Research Study to Broaden Reach Customers’ input and the performance of your brand in terms of recognition, competition, public perception, and reputation should be tracked as your

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company grows. Now is an excellent moment to evaluate packaging design to boost the appeal of your goods. Brand monitoring analyzes your brand’s performance using trends and data to provide insight into how your brand is regarded by the public. Testing your packaging design will offer you insights on how to improve its customer appeal.

4.12.2. Conducting Market Research to Determine Whether the Market Is Maturing Keep an eye on your brand, competition, and the newest trends to see what the future holds for your product. Your product line may require expansion, your brand may require updating, or you may need to enter a new market (Lages et al., 2008). Brand monitoring assists you in keeping track of your key performance indicators (KPIs), understanding how your brand is changing, and identifying marketing trends. • Competitive intelligence to monitor changes in your competitors’ pricing, marketing, and product lines. • Increase market saturation by doing market research. When your competition has grown to the point that the market is oversaturated with identical things, you may use our solutions to change your course. When deciding how to extend the market, consider market size, client segmentation, the discovery of new features, and product innovation.

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• • •

• • •

The size of the market will assist you to assess whether or not there is a demand for your items. Segmentation research can assist you in identifying new demographics who could be interested in your offering. Analyzing use and attitude data might help you uncover new product features or upgrades that your consumers would love (Lim et al., 2019). Through concept testing, you may concentrate on concepts that distinguish your product from the competitors. To help the market’s downfall. Discover why your product’s sales are falling. For example, you might use SurveyMonkey to determine if your target market is still interested in what you’re saying or if the claims you’re

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making about your products can be substantiated (Lichtenthal & Eliaz, 2003). • Your message and claims should be reconsidered to determine if they still ring true with your target audience. • Ad testing to discover the most effective way to reach your target demographic. Customers may submit feedback on how well your product is received and whether any adjustments or improvements should be made.

Figure 4.9: A graph showing how the growth such as trees in the product life cycle Source: https://www.istockphoto.com/vector/hand-drawing-productlife-cycle-image-business-flamework-white-isolated-gm1200215412– 343701060?phrase=product%20life%20cycle

4.13. MARKET DEVELOPMENT What exactly is “Market Growth”? The purpose of market development is to expand a current market rather than to seek a new one. New customers are aggressively sought after to increase the product’s appeal to a broader variety of potential buyers (Dowell et al., 2015).

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Market development is a two-step process for breaking into untapped markets. To begin the process, a firm conducts segmentation research and identifies probable market categories. Attracting new customers through the utilization of an already established product or service. The goal is to reach a larger audience or to enter a new market or demographic. The term “segment” refers to a subset in the context of a larger population. The marketing department of a corporation, for example, can split the market into segments based on characteristics such as geography, demographics, and income (Di Benedetto & Lindgreen, 2018). After you’ve determined your target market, you’ll move on to the following stage of market development. To get their product into the hands of consumers, businesses may need to employ both audio and visual media.

Figure 4.10: Steps showing the product lifecycle Source: https://www.istockphoto.com/photo/product-lifecycle-gm488261655– 39210950?phrase=product%20life%20cycle

Another factor to consider is the price of the goods. If there are competing things on the market, you may boost the price of your product by altering the cost of releasing a similar product that stands out for other reasons. The marketing team may investigate aggressively underpricing the items to compete with rivals to gain market share and avoid competition. Companies face significant costs when entering new markets. To move further, the effort will need significant financial investment. For the effort to be beneficial, investment in the new industry must yield a good return.

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4.14. MARKET INTRODUCTION What exactly is the Introduction Stage? The introduction phase is when a new product is initially introduced. Because the product is still relatively new on the market, the firm must spend a significant amount of money on advertising to increase sales. Businesses attempt to spread the word about their product or service during the introduction phase of the product life cycle. After the product has become well-known through advertising or branding, the firm may consider additional factors such as pricing and distribution. Proper price consideration is critical during the product’s launch phase to achieve market share. The majority of businesses employ a price-cutting approach (Krings et al., 2021). When a company adopts this pricing approach, customers who are eager to buy are often paid high prices. When newer, more powerful mobile phones are launched, price gouging is typical. Companies with well-known brands are responsible for ensuring that the new product stands out and that the user enjoys using it. Wireless charging and fingerprint unlocking are only two examples of novel features. Even during flash sales, which corporations use to promote new items, prices are outrageous. The Nexus Series 6 smartphone from Google, for example, has a list price of Rs 44,000 on an online retailer. The phone’s modern features helped to justify its expensive price.

4.15. DIFFICULTIES IN THE INITIAL PHASE When new items are first released, they either have no market or have a very small market. This means that the initial batch of sales will be severely limited. Most products require time and work to generate this sort of momentum, while there are a few outliers, such as a fantastic new product or a clever marketing campaign. It is unusual for anything to be produced without some type of research and development first to build the kind of demand required for a new product to be a commercial success. Both have a large potential cost, which may be in the millions of dollars in some places (Kim & Moon, 2021). Firms in the Initial Stage of the product life cycle will incur losses owing to the costs of bringing a new product to market, but the amount and duration of these losses may vary depending on the market. In contrast

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to other industries, where enterprises may take years to generate a profit, certain manufacturers may be able to achieve it in a matter of months. The introductory phase offers several advantages. If a corporation is the first to create and sell a unique product, it will have a significant competitive edge. Walkman, Biro, Tannoy, and Hoover, for example, were all the first to market with their products, allowing their brand names to be associated with the whole line of items they were selling. As soon as a new product reaches the market, producers are often able to charge prices that are significantly higher than the average market price. Early adopters are prepared to pay extra for a new product when it is first produced to offset the costs of manufacturing and publicizing it. Manufacturers may opt to take the opposite route and provide low-cost items to stimulate demand.

Figure 4.11: An infographic showing how a deal has been Source: https://www.istockphoto.com/vector/two-business-partners-areshaking-hands-the-investor-investing-money-to-idea-and-gm1254583061– 366739471?phrase=market%20introduction

4.16. PRODUCT LIFECYCLE ADMINISTRATION The primary aims of the first stage of the product life cycle are to generate customer demand and to build a market. The primary aims of this project are to promote the new product, increase manufacturing efficiency, and establish efficient distribution channels (Dlačić, 2015).

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4.16.1. Market Growth Market expansion is defined as a rise in customer demand for a certain product or service. The expansion of a corporation into new markets is frequently followed by a period of fast growth. Price strategy, advertising of product benefits, and initiatives to increase the product’s worth can all assist enhance sales. The market expands as long as the product is sold at a given price point. If clients enjoy this price point or the items, the market’s demand will rise; if they detest it, demand will decline and growth would stall. Market growth and market demand are inextricably linked. As the price of the product rises, the number of clients decreases. Customers for high-priced items with a limited target market diminish when the price of their product falls. This signifies that the consumer-to product or service price ratio is inverse. Increasing revenue and decreasing expenditures are inextricably linked (Kumar et al., 2020). Several variables drive market growth, including product demand and supply, market development, and the presence of competitors. These factors have a direct impact on market growth. They might be useful or damaging.

Figure 4.12: A person analyzing his trades online via phone and laptop Source: https://www.istockphoto.com/photo/man-analyzing-crypto-graph-onlaptop-screen-gm1311706498–400732049?phrase=market%20growth

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4.17. THE FACTORS INFLUENCING MARKET GROWTH The market’s expansion is justified by a variety of variables. One of the first steps is to make a demand. “Demand” refers to the market’s necessity for a product or service. Consumer demand is influenced by a product’s pricing, the status of the market, rival products, and market trends. The market potential of a product rises in tandem with its popularity (Kleinaltenkamp & Jacob, 2002). As a result, as the market expands, so will demand. Customers’ propensity to pay less for your goods as compared to rivals.’ As a result, even if the market expands, you will not benefit. The next step is origin. While the cost of the same product rises substantially when supply falls, the cost of the same thing reduces when supply increases. Customers are obliged to spend more money to purchase a product of the same quality, resulting in a bigger market. Increasing supply has a wide range of beneficial market consequences. If the product’s price continues to fall or if buyers find alternatives, the market may contract.

4.17.1. Excessive Costs If a product is supplied at a premium, its base price will climb. It might also be a more expensive version of the product that is different. The fact that it is more expensive than comparable solutions is another reason to charge a premium (Johnson et al., 2012). Prices for plane seats vary depending on where they are located, as is customary in the airline sector. A single seat on the same airplane might cost anything from $400 to $800. Additional perks, like extra legroom and priority luggage, can be added to the ticket to make a difference. The market will rise as the demand for high-end goods and services develops.

4.17.2. Action Planned A higher-quality product will be more costly. The pricing is likely to boost the sector’s growth. Whatever the cause of strong performance, it has a favorable influence on market growth. For example, the price of a mobile phone varies according to the model’s capabilities, and this variance is represented in the pricing.

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The most recent iPhone model will always be more expensive than prior generations, with the most recent model being more expensive. The latest models will increase revenues and help the company grow its market Gregory et al., 2019).

4.17.3. Commoditization Commoditization happens when the price of a product is the most important element in a customer’s choice to purchase it. In this situation, the customer is aware of some product variations. This is frequent when a brand-new product or technology enters the market and soon replaces whatever came before it. With the arrival of DVD players, for example, the price of VCRs and CD players dropped considerably. Following the advent of the iPod, the price of tape players fell precipitously.

4.17.4. Inflation Inflation is one of the most fundamental factors influencing market expansion. Even though the market is growing at a certain rate, a product’s sales may have climbed by 5%. The immediate market growth will be harmed (Griffin, 2002). Because of its negative origins, inflation harms market expansion for the vast majority of goods and services. To maintain market expansion, every product will have to deal with inflation at some time.

4.17.5. Statistics The size of the target market might vary greatly depending on the product or service. People of various ages will have distinct product requirements. People in their early twenties, for example, have a great desire for cuttingedge technology and fashion trends. Medical supplies, on the other hand, will be required by the elderly. As a result, market development is based on population growth and consumer demand.

4.18. MATURITY After the boom phase, revenues increase at a slower rate. The onset of maturity is nigh. The bulk of things that have been available for some time

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is situated at this stage. Consequently, the majority of marketing activities concentrate on established commodities. One such way is supplying many variants of the same product (line extension). Originally, there were six flavors of Kool-Aid. There are currently over 50 varieties, both sweetened and unsweetened. Following the Introduction and Growth stages, a product reaches the Maturity phase. The third phase of the product life cycle can be challenging for manufacturers (Hinterhuber & Liozu, 2015). In the first two phases, firms attempt to build a market, then expand product sales to capture as much of that market as practical. However, during the Maturity era, the key aim for the bulk of enterprises would be to preserve market share despite a range of issues. The following are the challenges of the mature stage: As fewer new consumers enter the market following the expansion stage’s steady increase in sales, the market begins to become saturated. The vast majority of potential buyers who would ever purchase the product have already done so. Decreasing Market Share: Another feature of the mature phase is the availability of rivals for market share. During this time of the product life cycle, it becomes increasingly tough for enterprises to retain their market share since there is generally the most rivalry. While this stage in the product life cycle maybe when the market as a whole receives the most money, many manufacturers may begin to see a drop in profitability. As sales are predicted to peak during this period, any business that loses market share and has a fall in sales is likely to see a commensurate decline in profitability (Janita & Miranda, 2013). This reduction in profitability might be accentuated by the price drops that are often witnessed when the sheer amount of rivals pushes some of them to strive to acquire more consumers by competing on price.

4.19. POSITIVE QUALITIES OF THE MATURE STAGE Continuing Cost Reduction: Just as economies of scale in the growth stage helped to decrease costs, manufacturing advances can lead to more efficient procedures for producing enormous numbers of a single product, so decreasing costs even more. During the maturity stage, market saturation may arise, but manufacturers may be able to enhance their market share and revenue in other ways. Increased market share by differentiating corporations can legitimately improve their market share through diversity by implementing inventive

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marketing methods and offering a larger variety of product characteristics. There are several instances of firms doing this during the product life cycle. Throughout the maturity phase of the product life cycle, producers confront many problems. When sales are at their peak and the market is saturated, it may be very difficult for firms to sustain their earnings, much alone try to increase them, especially in the face of generally quite intense competition (Iglesias et al., 2020). During this period, market share will be preserved, and may be improved, by enterprises who hunt out imaginative ways to boost the customer appeal of their items.

4.20. MARKET DECLINE Decline is the final stage of a product’s life cycle, typically represents the start of the end for a product. In this circumstance, the regular product life cycle curve is visible because sales and profitability have fallen. Producers may still be able to earn from their products despite the current economic crisis.

Figure 4.13: A drop in the market Source: https://www.istockphoto.com/photo/stock-exchange-market-is-crashing-gm1028826792–275765559?phrase=market%20decline

Next stage is the concerns about the stagnation stage. At this stage in a product’s life cycle, product markets will begin to contract. The manufacturer

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has little influence over whether buyers opt to replace this product with something better or more modern. Manufacturers’ sales and total profit margins will begin to drop as a result of the market catastrophe. Firms may seek to increase their market share to offset a fall in sales and profitability, albeit this may be more challenging in the decline stage of the market cycle than in the maturity stage (Iankova et al., 2019). When a product is no longer profitable, many producers may opt to discontinue production. If this downturn cannot be stopped, many firms may be forced to quit selling their products entirely before they begin losing money. There are advantages in the final phases of decline. Despite the present economic downturn, some firms may be able to profit from their products provided they can reduce their expenses. Alternate manufacturing techniques, new procedures, or shifting production to another location may allow a company to increase the profitability of a product. Certain businesses may need to search into new, less expensive markets for sales during the Decline period. Previously, these markets would not have been worth the effort to enter (Hunt, 2013). Firms, on the other hand, frequently view things differently when the only choice is to withdraw a product entirely.

4.21. PRODUCT LIFECYCLE ADMINISTRATION A diminishing market and a drop in sales and profit characterize the Decline stage of a product’s life cycle. A product may be manufactured for a limited time before being phased out if the business model no longer supports it. Some businesses, on the other hand, may be able to extend the usable life of their products while still maintaining a profit margin by investigating new, less expensive manufacturing processes and markets (Yang & Gabrielsson, 2017). Even in a downturn, a product may be successful, and the greatest manufacturers focus on product life cycle management, which helps them to maximize the potential of every product they produce.

4.22. IMPORTANCE OF THE PRODUCT LIFE CYCLE Understanding the product life cycle is critical in business since it influences the marketing approach for a certain product. It may be used for some purposes, including forecasting and planning.

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• Managers can use it as a tool. • It makes tips for increasing sales. • It is a profit estimation tool. • It facilitates the creation of new things. • It’s a good approach to predicting the future. Product life cycle management is an important technique for sales forecasting because it gives information about the obstacles that a product experiences during its many stages of development. Another advantage of using this technique is that it may be used to assess a company’s sales potential as well as its long-term objectives and ambitions. It might be quite beneficial to your future career aspirations. It serves as a planning tool. Second, it is an important tool for organizing a specific item since it provides the information required to develop marketing strategy and policy. It is an essential organizational tool (Wang et al., 2008). It is beneficial to draw cues from your competition while developing a great marketing plan. Without this technology, it is difficult to report on data from product life cycle management. It is a management tool. The third use of the product life cycle is in regulation, as the marketing manager may make the necessary preparations to get a product on the market and repair loss-control devices. A marketing manager can estimate the control work of this instrument swiftly and efficiently. Using this tool, you can determine whether or not a task or project is on track depending on the present condition of the plan. It also contributes to the formulation of the plan’s approach (Wang et al., 2016). The following are some marketing strategies. Numerous plans, rules, processes, and strategies are used at various phases of the product life cycle. Management can then devise marketing strategies. Marketing activities also have an impact on the evolution of the product situation. The marketing department manager creates marketing efforts to fulfill marketing objectives. A great market research report is made up of several marketing programs, such as data collecting, survey design, competition analysis, sales forecasting, and the identification of the ideal customer.

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It is a profit estimation tool. Profit growth and fall are therefore controlled by a firm’s turnover ratio, which is the fifth most significant aspect of the product life cycle. Earnings are initially low, but they rapidly decline and finally disappear (Voola et al., 2022). Examining the product life cycle can help with all of these objectives. If earnings are predicted to decline, the firm is in a declining stage, and vice versa. The use of this technology allows for the fabrication of new things. Technology is a significant aspect to consider when determining the lifespan of a product: As a result, the company’s leadership is always trying to improve or develop new products. Researching market events, creating marketing campaigns, and researching rivals’ pricing strategies can all be done to prepare for the production of new items. Products progress through the stages of market expansion, market maturity, and market decline beginning with their debut.

Figure 4.14: A person analyzing their annual profits Source: https://www.istockphoto.com/photo/businessman-plan-businessgrowth-and-financial-increase-of-positive-indicators-in-gm1361507082– 433910732?phrase=market%20introduction

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5

CHAPTER

DESIGNING PRICING STRATEGIES AND PROGRAMS

CONTENTS

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5.1. Five Levels of Strategic Pricing ........................................................ 110 5.2. Retainer Pricing .............................................................................. 112 5.3. The Advantages and Disadvantages of Retainer Payments ................ 115 5.4. Implementing Retainer Pricing in Seven Simple Steps ..................... 116 5.5. Value-Based Pricing ........................................................................ 120 5.6. Cost-Plus Pricing vs. Value-Based Pricing ........................................ 122 5.7. Package Pricing............................................................................... 123 5.8. Increasing the Value of Bundled Products May Result in Reduced Sales ......................................... 125 5.9. Bundled Pricing vs. Tied Selling ...................................................... 127 5.10. How to Describe a Bundle Pricing Strategy ................................... 128 5.11. How to Combine Prices ................................................................ 129

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For corporations, the four Ps of the marketing mix is a product, price, location, and promotion. Price and a company’s bottom line are inextricably linked. A product must be lucrative for the organization to continue functioning in the future. Customers should be aware of the value supplied by the organization through price strategy. Businesses are increasingly encountering several price-related concerns (Veloutsou & Taylor, 2012). Furthermore, as the internet has risen in popularity, client understanding of price information has grown. Priceline and eBay, for example, empower users to choose their pricing for both products and services.

Figure 5.1: Background diagrams Source: https://media.istockphoto.com/photos/charts-background-diagramsgraphs-and-financial-documents-on-table-picture-id1221687711?k=20&m=1 221687711&s=612x612&w=0&h=Yz3NoQFIelrNLXdqTAHASKsnxzujUJ8jy5oeOh5ENyU=

Pricing strategy is inherently dynamic, and it must account for altering market and competitive situations. Pricing plans are often based on a sixstep model: Step 1: Pricing can enable the firm to attain its positioning objectives. If the business was functioning at capacity or in a scenario of strong competition, pricing would be established taking into consideration part of the fixed expenses as well as the variable costs. This approach is supposed to be implemented extremely temporarily. If a corporation wishes to maximize sales, it will boost its price while considering cost and competition (Theron

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et al., 2008). This method involves the danger of igniting consumer or legal difficulties. If the corporation seeks to expand and extend its market share, the price will be cut to create the highest volume. Companies wishing to offer cutting-edge merchandise and breakthrough technology attempt to achieve market-beating prices. Step 2: The product has a clear demand at every price point, according to the second law of economics. This law, however, fluctuates depending on the sort of product; for example, demand for commodities drops as prices rise, whereas the desire for luxury things grows as prices rise. Businesses must map the demand curve in terms of pricing to understand price sensitivity. This demand curve may be approximated statistically by reviewing historical data, conducting price-related experiments to determine the prices that consumers are willing to pay, or completing market research and individually querying customers about their preferences. Step 3: To maintain a healthy profit margin, firms must keep spending under control. Businesses must establish a production level that allows them to sustain fixed and variable costs. The learning curve effect, which emerges as a result of experience, is well recognized as driving cost per unit to fall as production level increases. Activity-based costing is becoming increasingly widespread as it provides effective cost allocation and precise profit forecasts. Another approach to cost setting is the target costing technique, which has proved popular among Japanese enterprises. Companies set the price and profit margins for target costing. They then concentrate on costs to maintain the profit level (Tuten & Urban, 2001). Step 4: Companies should closely monitor what their competitors are doing in terms of price, cost, and promotional offers. Companies must be aware of how much their rivals’ prices may deviate from the one established by the firm. Step 5: The price is estimated using numerous approaches. The most frequent option is the markup technique, in which the price is fixed at the specified profit level. Prices are created using the target return pricing technique based on company-specified returns on investments. Setting prices based on customer perceptions of value and a company’s capacity to supply that value is referred to as the perceived value pricing approach. Companies apply the value pricing strategy to charge less on items that have committed consumers. This strategy is extensively applied in supermarkets. Group pricing, going rate pricing, and auction type pricing are some different pricing systems.

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Step 6: Now that the previous five stages have been done, firms may select their ultimate pricing. This ultimate cost is set by taking into consideration how buyers evaluate the product’s quality. Positioning with the marketing and advertising strategy also affects the eventual cost. Pricing should be modified to account for market segmentation, location, and general economic conditions (Backhaus et al., 2011). Companies should keep price flexibility and respond to changing market conditions. Companies must review their underlying purpose rather than just responding blindly to pricing changes created by competition.

5.1. FIVE LEVELS OF STRATEGIC PRICING World Class Price: The Journey is a book I recently published to “get personal about price.” After more than two decades of experience and 700 projects, we developed a pricing strategy that is now used by all of our clients. Pricing products solely based on cost does not always reflect what customers are willing to pay for them. Finding out what customers like and dislike about a product can help a company decide whether or not to raise its prices, or it can indicate that a new product will fail. Even though every firm has a pricing strategy, it may be difficult to determine where your company fits into the 5-levels: • Level 1: The Firefighter In many cases, firefighters risk their lives for little or no pay. This is also true for level 1 pricing managers. Level 1’s pricing procedure is sloppy. Pricing is highly volatile and erratic. Sales teams must set prices quickly to avoid losing deals and alienating customers. This irrational fear frequently leads to steep discounts. Companies at Level 1 replace fear-based, reactive decision-making with proactive tools and procedures (Baumgarth & Schmidt, 2010). • Level 2: The Policeman At Level 2, the primary concerns are control, enforcement, and accountability. This is not a “Dirty Harry”-style police force, despite the name. If pricing managers take a no-holds-barred approach like Clint Eastwood’s character in “Dirty Harry,” sales will quickly rebel and find ways to circumvent the pricing department’s authority. Customers and markets may perceive the new pricing processes’ rigidity as insensitive when selling at Level 2. Companies in this industry are therefore looking for a skilled pricing manager who can connect pricing to other critical business processes such as profitability. Furthermore, sales compensation must be improved.

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A smooth transition to Level 2 can be facilitated by rewarding salespeople for increased profits and shifting away from price competition and toward value selling. • Level 3: The Partner Level 3 pricing aims to create a single-price strategy by integrating sales, marketing, operations, and finance. Each division is responsible for providing reliable consumer data and insights to support the company’s value offer. Accountability is no longer limited to the sales staff. Cost and value conversations in groups result in more effective pricing strategies (Theron et al., 2008). The transition from Officer to Partner is anything but easy. It is tough to transition from an “inside-out” to an “outside-in” value-based strategy. We go into great depth about this process, which normally takes between 18 and 36 months, in our book World Class Pricing: The Journey. • Level 4: The Scientist Sophisticated optimization research is at the heart of The Scientist. Before going towards optimization nevertheless, organizations need to increase their grasp of flexibility. Elasticity helps handle challenges such, as should the pricing of present things be increased or decreased? What is the right pricing gap between numerous SKUs or a new competitive entrant? How can incentives be optimized? Or what is the ideal price structure? Although the concept is fundamental, actually assessing elasticity is tricky; because the demand curve is not generally flat, gradually dropping a line. However, Level 4 price managers don’t need to become statisticians. Instead, they’ve got a fantastic grasp of how to employ the different optimization approaches, like conjoint analysis, transactional analysis, and testing. Another key component of a Level 4 pricing manager’s task is the obligation of creating a culture of pricing inside the firm. They are heavily involved in price training of the sales and marketing teams. Achieving the Scientist is a great accomplishment. • Level 5: The Master World Class Price: The Journey profiles famous CEOs who have mastered prices, such as Steve Jobs of Apple and Howard Schultz of Starbucks. Marriott International and Procter & Gamble are two Level 5 pricers. Companies at this level employ advanced pricing approaches, and these methods are deployed more quickly and efficiently (Bendixen et al., 2004). Businesses, on the other hand, understand that cutting expenses will take time. Businesses and master pricing managers are always evolving.

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Figure 5.2: Stack of coins Source: https://media.istockphoto.com/photos/green-arrow-upward-on-stackof-coins-and-growth-graph-on-bokeh-picture-id1303853966?k=20&m=130 3853966&s=612x612&w=0&h=B692FwN9hKRsbeNB2QuaHelmyi12CSUJ2fD6fBwlrtI=

5.2. RETAINER PRICING A retainer fee is an advance payment provided to a professional by a customer as a deposit for the professional’s future services. When you sign a working agreement, the retainer fee covers all of your initial fees, no matter what profession you pick. Consequently, these fees are generally maintained separately from the hourly salary of the consultant, freelancer, or lawyer. The money will not be withdrawn from the account before the task is done. Fixed rates and T&M revenue models need payment in advance for future services. Retainer pricing, on the other hand, rewards a customer in advance for future services (Biemans et al., 2010). A retainer pricing plan is typically employed when you’ve created trust with a customer and want to continue working with them while preserving a constant flow of money for your business. Service-based retainers have been introduced by certain professional organizations with remarkable success, but this is not the case for all.

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The difficulty originates from the inability to keep track of the quantity of work that is allotted to each retainer period, as well as the lack of transparency on completed tasks. No matter if you’re just starting started with retainer pricing or want to strengthen your existing client connections through the usage of retainer-based cooperation, we’ve got you covered. Clients pay a retainer fee with the expectation of continuing to employ your services in the future. With this price model, the consumer agrees to pay upfront for professional services that will be supplied at a later date within a specific time frame, as opposed to other pricing models. Retainers, as opposed to standard one-time fixed-price contracts, provide a constant flow of cash. For consultants, a retainer would require allocating a defined amount of time each month to each client’s work. It may be useful for clients who need specialized services to have access to professionals. Retainer agreements are becoming more common as a technique for boosting income stability and strengthening client connections.

Figure 5.3: Business man trading online Source: https://media.istockphoto.com/photos/businessman-trading-onlinestock-market-on-teblet-screen-digital-picture-id1311598658?k=20&m=1311 598658&s=612x612&w=0&h=DsH-Xq0w9pENqAw2i9EU4u4t-GZBKNndseKeOleByiY=

A retainer agreement is a fantastic alternative for consultancies because of the advantages it gives over a one-time, fixed-price contract. It’s typical for firms that provide regular services to their clients to charge a retainer fee.

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You should be familiar with the notion of retainers if you’ve worked in the consulting, advertising, or IT sectors. Depending on the patient, retainers can either function or not. A lot of things indeed come into play, including the sort of projects you’re working on, your connections with clients, and the structure of your present business (Theron & Terblanche, 2010). It is possible to reserve your services for a customer in advance through the use of a contract known as a retainer. They make perfect sense in times of uncertainty when the services you’re delivering are not bound by a precise project timetable owing to continually shifting plans. Consequently. Retainer pricing, on the other hand, is great for agile teams since it allows them to adjust their approach on the fly. For customers, whose firms are quickly developing, retainer agreements are ideal since it is tough to keep up with the flood of extra obligations. To secure your services for the following month, customers may prefer to pay a retainer fee to your organization because they are unclear when they will want extra support. Some consumers want to pay you for the value you deliver, while others demand your entire attention all the time you’re working with them. Retainers work well when you and your customer desire to maintain a long-term connection. You may eliminate paperwork and concentrate on establishing and implementing your strategy, rather than calculating costs and doing other administrative activities, by choosing retainers instead of fixed-price projects (Streukens et al., 2011). Retainer contracts, on the other hand, aren’t always a sure thing. A flat cost may be preferable to a retainer if a firm simply requires a single campaign.

Figure 5.4: Wooden Sea Saw with value-price wording Source: https://media.istockphoto.com/photos/wooden-seesaw-scale-emptyon-wooden-sphere-on-wood-table-with-wording-picture-id1303850380?k= 20&m=1303850380&s=612x612&w=0&h=4AmM-10g4jOCQhU0Z5fkaWw7Ut-D8PlNHgb8pwFIZsk=

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5.3. THE ADVANTAGES AND DISADVANTAGES OF RETAINER PAYMENTS To lessen the volatility of digital agencies’ business sources, retainer pricing is increasingly accepted. In comparison to one-time, fixed-price projects and time-and-materials projects, retainer contracts provide several benefits. There are, however, some downsides to a retainer price plan, so let’s take a look at the benefits and cons first. The Retainer Pricing Model provides several advantages. For a variety of reasons, retainer pricing is a popular choice for both agencies and customers. It’s feasible that retainerbased agencies can more precisely estimate income than those that employ alternative pricing systems. It is easier to assess cash flow and control costs when you know what to expect from the beginning. Forget about seeking new clients who can pay you this month and developing project ideas; instead, focus entirely on the wants and challenges of your clients and offer outstanding services (Chang et al., 2018). Because of this, your clients will know that you will be available at a given time. Everything is distinct when employing a retainer pricing approach. A client’s impression of you as a trustworthy counsel is strengthened when you accept retainer agreements. As long as you have the client’s undivided attention, you may spend more time learning about their long-term goals and any impediments. Ian agrees that this alters your mentality from that of a service provider to that of an expert. Clients and agencies both enjoy retainers. In addition to saving time, working with someone who has a solid grasp of your brand delivers better work. No more looking for service providers or agonizing over who to call when they need help with another job since clients have priority access to a trustworthy individual. If the budget is fixed, the customer may be able to save more cash by preparing ahead. A retainer price arrangement introduces testing and optimization that are not acknowledged.

The downsides of employing a retainer charging strategy Maintainers are not for everyone and may even be damaging, like any other price scheme. When both parties fail to explain expectations, retainers become riskier as the workload seldom matches yours. Inadvertent underor over-servicing of clients may happen. When a retainer is put up poorly, the client typically pushes more work through the resources for the same retention charge, which can inhibit procedures, produce scheduling issues, and diminish your earnings. Consumers value a transparent process,

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which means they want to know precisely what they are paying for and what they are receiving in exchange for their money. This is where one may locate professionals. Many organizations fall short (and blame the retainer structure), saying that a retainer pricing model lacks client-desired transparency (Claycomb et al., 2005). If you fail to give openness and continue to have hourly confrontations with clients, it is time to reassess your strategy. Start immediately by reviewing the ways provided below to strengthen your customer relations and company processes.

5.4. IMPLEMENTING RETAINER PRICING IN SEVEN SIMPLE STEPS The move from one-time jobs to retainers need not be problematic. A few general procedures must be done to guarantee a seamless transition (or hacks, if you prefer). Without a platform to track the effectiveness of your retainers, this is challenging. The forecast is one such tool that supports several budget forms and simplifies moving between them. Following this caveat, we’ll show you some Forecast screenshots to illustrate what a good retainer arrangement looks like. The forecast is a comprehensive solution for project and resource management with retainer pricing. Let’s get started quickly. Reserve a predetermined amount of time for a customer. When developing a retainer-based agreement, the most crucial thing you can do to prevent disappointing your clients is to assess how much of your available resources you can reserve for the new client. Examine your resource availability for the upcoming months to ensure you maintain the necessary bandwidth levels. Remember that your retainers should be contingent on the quantity of work your team can perform. Immediately create extremely clear expectations. Clients usually question what the retainer money covers. Do not be evasive while discussing the value you can deliver to the client. Instead of leaving their clients to “hope for the best,” competent experts articulate their method for accomplishing the goals (Shaltoni & West, 2010). Make a strategy and figure out the specifics beforehand. You may avoid leaving your clients in the dark about what they are paying for by taking this action. Increasing the workload is not necessarily linked with client happiness. In this case, it is vital to understand what the client wishes to achieve with your services.

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Figure 5.5: Concept of rising energy Source: https://media.istockphoto.com/photos/concept-for-rising-energy-costspicture-id1363994695?k=20&m=1363994695&s=612x612&w=0&h=S6DyF OxWuAX2a38EF_c58fFKmz23wia-FmD7Ul00j54=

5.4.1. Consider the Client’s Comprehension of the Results Before you begin crafting the strategy, examine if the services you wish to give fit the particular rating criteria. Is the client compensated monetarily for utilizing your services? What is the predicted outcome? Request that the consumer articulate quantifiable expectations. Determine the tasks that must be done. Undoubtedly, a plan with due dates will be crucial for you and your team to know what to work on and when. You may be as detailed as you like by breaking the period into tasks and milestones. A typical retainer involves a job scope for a specified period (Sharma et al., 2010). Shifting from oneoff projects to retainers helps you to become more adaptive and symbolically “take a chance” on scope creep because retainers are everlasting. They are constantly seeking to improve and renegotiate best practices. We advise arranging your retainer periods so that the client and team are aware of the direction you’re heading, the strategy you’re talking about for a particular difficulty, and the projected delivery date.

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5.4.2. Estimating the Time of Jobs Is Another Key Component of Scoping Using Auto Schedule in Forecast, you may be able to resolve this quickly. Intelligently allocate folks to tasks or projects. Before integrating service retainers efficiently, you must assess the organization’s resource management. Before making a change, adds Alexandra Gannon, general manager of Reload Media and author of the Shopify piece, you should analyze your team’s skills and project management circumstances. Given the current trend toward multi-streaming, it stands to reason that resource allocation becomes even more problematic when people are allocated to many teams and projects simultaneously. Around 81% of the 500 foreign managers questioned reported that their team members worked on numerous projects simultaneously (Chang et al., 2012). Another study of knowledge-intensive organizations revealed a 95% gain in performance. Managers commonly commit the fallacy of allocating resources depending on conditions. This is especially true in consulting organizations, where individuals are randomly assigned to projects regardless of their availability or skill set. Customers, on the other hand, demand great service and feel they can access the most competent professionals. If the expectations of your retainers are not satisfied, they will begin to act against you. These wasteful practices not only diminish the efficacy of your resources but also influence client interactions.

Figure 5.6: Piggy bank Source: https://media.istockphoto.com/photos/energy-saving-picture-id130848 0383?k=20&m=1308480383&s=612x612&w=0&h=IANL_OhP_KZaHmiozWcKjHTwT8TV36eKuTuNdG1yywI=

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5.4.3. Encourage a Culture of Timeliness The moment has come for your firm to begin logging hours worked. There are so many benefits to completing daily timesheets that it’s hardly even funny. By having your personnel record their time, you may prevent overcharging consumers for the same amount of service. Time logs will allow you to track the quantity of work performed for each retainer period and guarantee that nothing begins on the half-hour. You will be able to present a progress report to your clients at the end of the month to ensure that everyone is on the same page. In the event of “time-based” or “set hours” retainers, time registrations are especially significant. Without reporting your time, you will be unable to know how much time remains on your retainers or assess your progress toward the objective (Cortez & Johnston, 2017). A word of caution: avoid a top-down deployment method when implementing the time monitoring application. If you guarantee that everyone knows the necessity of logging time, the shift will be considerably smoother and less disruptive. This can be done by relating time registrations to each individual’s objective, stressing work-life balance, or showcasing the team’s contribution to the broader total. Identify anomalies before they cause damage to the target. To ensure that your retainers are on track, you must monitor their progress toward their goals. Depending on the circumstances, a retainer aim can be specified in either hours or cash. If the client pays in advance, a fixed-price financial objective may be your best alternative. Nevertheless, time monitoring would make more sense if you had a predetermined number of hours to dedicate to each customer each quarter. Therefore, you would profit from the summary regardless of your budgetary or time limits. The forecast allows you to track retainers that are both fixed-price and fixedhour. Additionally, you may record the aim, projected time/cost, and time entries for the period. Maintain open communication connections with your clientele. Consider a standard time-based retainer, which is the most frequent in agencies but can be tough to track. You will trade your time for money, but only in larger chunks, presuming you and the customer have agreed upon a maximum number of hours. This reflects the client’s faith in you. Allowing your consumer to know precisely where their time or money is going and how much has been spent can help you preserve their confidence. There is a range of techniques for alerting the customer about the status of retainer periods and progress reports. Clients will benefit from understanding how much work has been performed and how much time or money is left on a

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retainer. The frequency with which you will provide progress updates to your client will be determined by the nature of your services and the length of your retainer agreement. If you have a monthly retainer, check in with the client every two weeks, assuming your team can complete a milestone in that time frame (Sheth, 2020). Your income is stable with retainer pricing, but if you don’t set everything up correctly and have no oversight, you may join the ranks of those who dislike it. To make it work, use Forecast’s retainer management features. Attorneys who habitually demand an advance retainer fee from potential clients fall under the broadest category of retainer fees. Taking a look at earned and unearned retainer fees.

Figure 5.7: Symbol illustration Source: https://media.istockphoto.com/photos/creative-concept-of-usd-symbols-illustration-and-finger-clicks-on-a-picture-id1223132013?k=20&m=12 23132013&s=612x612&w=0&h=9o7iUncjLNsq1FiTYyZkvK6zcm3jDuDeeQlEKjbapG4=

5.5. VALUE-BASED PRICING Worth-based pricing is a method of calculating prices that relies heavily on the consumer’s perception of an item or service’s worth. Customer-focused pricing is categorized as value pricing, which argues that firms decide prices based on the perceived worth of a product to the consumer. Value-based

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pricing is different from “cost-plus” pricing, which establishes prices after including manufacturing costs. Businesses that offer distinctive or highly valued products or services are better positioned to benefit from the value pricing model than those that largely sell commodities (Chang et al., 2018). Worth-based pricing is a pricing approach that determines costs mostly on the perceived value of a product or service to the user. Value pricing is a sort of customer-focused pricing in which enterprises establish their prices based on the perceived worth of a product by customers. Businesses that supply distinctive or highly valued features and things will benefit more from the value pricing model than those that only sell commodities.

5.5.1. Understanding Value-Based Pricing The value-based pricing approach is most effective in marketplaces where a customer’s acquisition of a product increases their self-image or enables them to enjoy outstanding life experiences. Therefore, the perceived value reflects the value that buyers are prepared to place on an item and has a direct impact on the final price paid by the consumer. Even if value pricing is not an exact science, marketing methods may be applied to establish prices. For instance, premium manufacturers solicit client input to learn how highly customers regard their driving experiences with a given car model. Consequently, dealers may now utilize value-based pricing to set the price of a car (Stein et al., 2013).

5.5.2. Essential Qualities for Value-Based Pricing Any firm that implements value pricing requires a product or service to separate itself from the competition. The product must be client-focused, which suggests that all upgrades and feature additions must be driven by user demands and desires. Naturally, if the company’s management desire to implement a value-added pricing plan, the product or service must be of the greatest quality. Examples of Value-Based Markets: The fashion company is one of the most impacted by value-based pricing, where value price computation is standard practice. Popular name-brand designers sometimes expect more costs because clients feel the brand influences their look. Furthermore, if a designer is successful in persuading an A-list celebrity to wear his or her garments to a red-carpet event, the perceived worth of the connected brand may improve. When a brand’s image suffers for whatever cause, its pricing strategy tends to revert to a cost-based pricing approach.

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Other firms vulnerable to value-based pricing methods include name-brand medications, cosmetics, and personal care goods. Value-based pricing is implemented when a product’s perceived worth is high. Products with a high level of reputation or that are wholly unique are commonly leveraged in this strategy. Designer apparel firms are wellknown for employing value-based pricing. While the production cost of a designer shirt may be much more than that of a non-designer shirt, the status associated with the designer brand raises the garments perceived worth. Many organizations apply this method to substantially enhance profitability while merely mildly lowering sales volume. A similar method may be utilized when a purchase is triggered by emotion. For example, even if a magnificent work of art fetches millions of dollars at auction, the cost of making it pales in contrast to the sale price (Sivarajah et al., 2020). Value and price are established by the artist’s reputation and other expressive aspects to which the client may attach. When scarcity is a concern, value-based pricing is commonly applied. During a concert, for example, bottled water can cost $6. A vending machine outside the event area, on the other hand, offers the identical bottle for $1. The expense difference is mirrored in the shortage of water during the performance and the demand that audiences drink water.

5.6. COST-PLUS PRICING VS. VALUE-BASED PRICING To fully understand value-based pricing, you must first grasp how it varies from cost-plus pricing. Under a cost-plus pricing strategy, a premium is simply added to the cost of producing the item or service. Under this hypothesis, the cost of making that product is the fundamental determinant of price under a cost-plus pricing system. Those for value-based pricing strategies are always higher than or on par with prices for cost-plus pricing approaches. The diagram above depicts how a cost-plus pricing strategy adds a markup and bases the item’s price on its cost. The value-based pricing method is utilized on products that have a much greater perceived worth than the price.

5.6.1. The Issues with Value-Based Pricing Value-based pricing may not always be the correct pricing approach for a corporation, and employing it may create a range of challenges. It can be difficult to assess the perceived value of a product or service. Costs or rival prices may be compared to derive a price in cost-plus pricing or competition-

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based pricing. The value-based pricing technique is more qualitative and includes speculation (Spyropoulou et al., 2010).

5.6.2. Value-Based Pricing Strategy Implementation Marketing and customer perception of a product are especially important in a value-based pricing strategy. The perceived value must be high since the price level will be greater than with a cost-plus method. Because of the extensive study required to establish a price decision, value-based pricing may result in higher implementation costs. Furthermore, differentiating the product from identical competitors may be expensive.

Figure 5.8: Blue Gradient Concept Source: https://media.istockphoto.com/vectors/valuebased-pricing-blue-gradient-concept-icon-vector-id1364582708?k=20&m=1364582708&s=612x612& w=0&h=YSHzfE-OHphO44nettXRA5Eqzb3zqWWsm5a5dklHrAo=

5.7. PACKAGE PRICING Bundle pricing is a pricing technique whereby multiple items are grouped and offered at a single, generally lower price. Bundled pricing is fairly ubiquitous in various areas, particularly retail. Almost sure you have experienced it in some fashion. I observed earlier that the Microsoft Office Suite and the Subway cookie promotion are two instances of bundle pricing. In both circumstances, a bundle of things is supplied at a discount relative to the cost of acquiring them separately. Getting PowerPoint, Outlook,

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Excel, and Word separately would be more expensive than getting them as a package (Saura et al., 2021). Generally speaking, package pricing methods are categorized as either pure price bundling or mixed price bundling. Each strategy has its applications and is suited for a wide range of organizations, conditions, and purposes. The following are some viewpoints on both problems.

5.7.1. Transparent Price Combination Pure price bundling is a marketing method when a seller only supplies particular things as part of a bundle or when the products in a bundle are so reliant that they must be sold together. Consequently, utility-tethered products are generally prone to pure price bundling. Typically, the controller or controllers are included when getting a used video game console. In this scenario, employing one product without the other is not an option. It makes no sense to supply the equipment without accompanying instructions for its use. Moreover, while individual controllers may frequently be purchased independently, they are of little value if you do not own the consoles with which they are compatible. Mixed price bundling is the more prevalent subtype of the approach, notwithstanding the popularity of pure price bundling in and of itself.

5.7.2. Price Distribution Mixed Price bundling refers to the practice of giving discounted products both alone and as part of a bundle. Typically, the components of a mixed bundle may stand alone. They can be used independently; however, they often complement or enhance the other things they are combined with. Value meals are one example of mixed-price bundling in the quick-service restaurant market. Many quick-service restaurants provide one or more types of meal bundles. In most fast-food outlets, you may acquire an entrée, a drink, and a side for less than you would spend for each item alone. When is a strategy of price bundling suitable for your business? The bundle pricing approach is ideal when you have a selection of products or services to sell or when you desire to boost the value of low-volume items (Rusthollkarhu et al., 2022). You may supply consumers with the functionality they need to maximize your service or product by selling these complementing items together. Bundle pricing optimizes the purchasing experience for customers and can result in longer-term customer engagement. Your product has the needed integrations.

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Some services in the connected SaaS and subscription industry of the current day are constructed on top of existing capabilities to give value or enable integration. Price bundling makes it easy to provide each new customer with the functionality they desire in a single transaction when your solution requires these types of connections to run correctly. In subscription billing solutions that integrate subscription management with extra features such as payment gateways, analytics, and revenue recognition, there are various instances of package pricing. You are needed to provide discounts on specific items. Sometimes, offering a discount is a necessary component of conducting a company, whether it’s due to a new competition grabbing your clientele or a lack of engagement among your current consumers. Although purposely cutting a product’s price could alter its perceived worth, price bundling might lessen these effects by putting discounted products together (Crick & Crick, 2020). This adds to the value of the customer’s purchase and enables you to generate more money each time. When evaluating price bundling, it is crucial to understand how clients benefit from each component of your firm.

5.8. INCREASING THE VALUE OF BUNDLED PRODUCTS MAY RESULT IN REDUCED SALES Price bundling strategies differ. The two basic kinds of price bundling are pure bundling and mixed bundling. Pure bundling is separated into two divisions based on how purchasers benefit from various things or services. Simply grouping pure bundling arises when a client can only buy the bundle in its current state or not at all. This form of pricing bundling is the simplest to conduct since you have entire control over the growth of a bundle (Rosenbloom & Larsen, 2003). Joint bundling and leader bundling explore the numerous parts in your bundle and how they interact. When you combine the correct features or things, you not only make it easier for clients to buy, but you also offer them more value for their money than if the features or products were acquired separately. As a consequence, you develop a more enthusiastic and loyal consumer base that is more willing to make future purchases. If you need help constructing your bundles, if done well, price bundling may effectively work as a type of upselling on its own. Customers that are hunting for a reasonable price but aren’t interested in your goods or service may be lured to you. A price bundle is always supposed to be a steal. The intriguing arrangement will benefit both you and potential clients, as it has the power to attract those

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on a restricted budget. Those clients may not be reflective of your current clientele. Prospects respond to incentives, and an efficient price bundling technique can give a particularly tempting one.

Figure 5.9: Food industry labeling Source: https://media.istockphoto.com/photos/food-industry-labeling-of-boxes-for-distribution-picture-id1320630689?k=20&m=1320630689&s=612x61 2&w=0&h=krY2RAkX7pegAsGoJXZnbL7ukS93ObxZFnPJrU_0HQQ=

Cannibalization of bundle items is one of the drawbacks of bundle pricing. In other conditions, if one of the bundle’s commodities were purchased alone, the profit margin would be substantially bigger. A pharmaceutical store may sell a bundle that combines a bottle of shampoo and a stick of deodorant, both with a high-profit margin. If the firm fails to correctly forecast customer demand, it may observe a reduction in sales of individual deodorants while the popularity of the bundle grows. If this is the case, it will lose a large percentage of the revenue from individual transactions. Customers may discard your bundle if they feel obligated to obtain stuff they consider unneeded. A smart price bundling technique involves careful product selection. Product bundles should be carefully built with commodities that complement one another (Rosenbloom, 2007). Customers may be unwilling to spend the extra money to buy a bundle of things that are not helpful or connected. Not simply throwing any old goods together to sell quickly. The aim is to persuade consumers who are considering buying a product to spend a little additional money on something that will improve their experience with the product they were thinking about buying.

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5.9. BUNDLED PRICING VS. TIED SELLING The phrases price bundling and linked selling are often used interchangeably. Despite their similarities, the two conceptions are unique in terms of intent and legality. Although the process of bundling is still allowed, it is heavily restricted. Tied selling is banned. The degree of consumer option offered by each indicates how the two very functionally. Bundling is centered on leveraging rewards to influence choice. When two things are purchased together, purchasers are pushed to do so since the prices are cheaper. They can, however, purchase the bundled products separately if they are not interested in purchasing those items together. Influencing decisions through conditions is the heart of connected selling. Consumers will only offer an item or service if they also purchase another thing, often both at full price, under this approach. A bank, for example, may only permit clients to apply for a specific credit card if they first open a savings account with the business. If you’re contemplating using a pricing bundling strategy, it’s crucial to distinguish between these two techniques (Ritter & Pedersen, 2020). Even while distinguishing between the two could be tricky at times, learning which is which might help you avoid legal issues. When determining how to price your things, it’s crucial to appreciate the nearly omnipresent notion of price bundling. It has the power to improve customer attention, make or break promotional sales, and help you maximize your sales potential.

Figure 5.10: Packaging Source: https://media.istockphoto.com/photos/small-business-owners-pictureid1367196694?k=20&m=1367196694&s=612x612&w=0&h=RdiulCQbuM MpJors67NBCzf87WMY0OQU210r6_ZPWAQ=

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Many e-commerce organizations and marketplaces place a premium on the adoption of bundle pricing schemes or cost-sharing among goods in the same pack. In truth, they aren’t primarily hired by internet retailers that have entire control over their product. Companies like Amazon leverage them to improve the average transaction value. Many folks consider that adopting package pricing tactics is a significant part of efficiently cross-selling items from the same brand. Because the product pairings in these circumstances are already set in bundles, the toughest cross-selling approaches alter slightly. If you’re still skeptical about the advantages of package pricing at this stage, consider the following points: the most competitive rates on the market; a direct rise in average transaction size; an increase in sales as a consequence of the call impact after evaluating choices; and optimization of shipping costs and logistics for each purchase (Davies et al., 2010). The user’s perspective of the pack Users prefers the ability to purchase packs in both digital and physical environments. Customers frequently like the financial advantages created by these things, so even when no more products are essential, they are more inclined to make this purchase decision. Because purchasing products in bulk saves time and effort, this attitude is maintained in e-commerce enterprises and online marketplaces. Having a range of alternatives in a single e-commerce store, on the other hand, provides online consumers the option of purchasing the things singly or as a bundle. Furthermore, it’s a perk that few people can resist: not needing to look for similar goods that “combine” together. If there was a drawback to package pricing approaches that needed to be highlighted, you’d find it right here. Many clients moan about having to buy a bundle of things when they just need one of them. Because of this, it is vital to give a variety of choices for single or group purchasing (Pires & Aisbett, 2003). In terms of price manipulation, it’s also crucial to be able to determine the discount for getting the pack, as well as whether or not one of the goods would be supplied “free” with the purchase. In every situation, you must describe the overall savings offered by purchasing the pack rather than the individual items.

5.10. HOW TO DESCRIBE A BUNDLE PRICING STRATEGY Before constructing your bundle price plan, it’s vital to have a list of everything you need to know.

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Conduct audience research. There is no other technique to understand what needs to motivate buyers to choose distinct things from your inventory. Examine their prior purchases to determine which things they typically buy at the same time. You must be aware of this information to know how they shop and what interests them. Examine and absorb the competitor’s catalogs. If they already provide bundles, it will be good to know which ones are included and how much they cost. Using rival pricing tracking software will also enable you to track when and how much they modify their charges (Naudé et al., 2009). Keep track of your inventory. Maintain a precise inventory of the products you have on hand to eliminate running out of time to deliver bundled bundles, especially if consumers may purchase them individually. It is a smart idea to put aside stock for each goal depending on their sales probability. Consider your profits and margins. Before you choose the cost for packets in your eCommerce organization, it’s crucial to have a concept of your manufacturing and producing expenses, as well as your anticipated profit margin. These are the variables that will allow you to adjust the pricing while still being profitable.

5.11. HOW TO COMBINE PRICES Once you’ve acquired all of this data, you’ll need to select which parts will be incorporated in this sort of plan and how. You may pick from a variety of pricing bundling choices based on the sort of things and the audience you’ll be targeting. When it comes to picking the sales possibilities for each product, you have three alternatives (Dowell et al., 2015).

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Mixed bundling: Products can be purchased alone or in groups. Even if it is normally accompanied by an advertisement highlighting the advantages of the pack, you must always make this decision to prevent losing clients who are hesitant to pay for items they may not require. This comprises accessories, spare parts, and replacement components whose core component is no longer needed after purchase. Pure bundling: Some commodities, due to their qualities, may only be offered as a bundle, whether due to market considerations

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or the expenses this involves for the organization. The number of sales may eventually fall in this scenario, but it’s also crucial to analyze whether marketing this product is a creative method to attract consumers who are particularly seeking it. A pack of little perfume bottles, for example, makes sense for both the consumer, who would want the extra goods and the e-commerce firm, which would not get the same profit by selling these separately at a cheap price.

Figure 5.11: Automatic case and box labeling Source: https://media.istockphoto.com/photos/automatic-box-and-case-labeling-line-picture-id1322339668?k=20&m=1322339668&s=612x612&w=0&h =SEsCySqVVFE7Vs7E2nQXylId3vZFXZK0DEX-OyUvAkE=

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Upselling and cross-selling discounts: The third choice for product bundling, as indicated at the beginning of this piece, is to give unique discounts for acquiring many units, significant savings on related goods, or an even greater version of the product for a little higher price. Finally, marketing teams must design and implement package pricing strategies (Michaelidou et al., 2011). They have a lot to offer in terms of distribution and even personalization depending on the channels chosen for dissemination. Any e-commerce firm or marketplace that engages in one-of-a-kind promotional campaigns will witness a large boost in revenue.

6

CHAPTER

MANAGING RETAILING AND WHOLESALING

CONTENTS

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6.1. Introduction .................................................................................... 132 6.2. Deciding on Company’s Market Value Proposition .......................... 135 6.3. Selecting the Best Channel Design for Retailing and Wholesaling ... 142 6.4. Factors to Consider While Selecting a Channel of Distribution ........ 145 6.5. Nature and Size of the Manufacturing Unit ..................................... 149 6.6. Benefits of a Good Channel Design ................................................ 150 6.7. Challenges Facing a Channel Design .............................................. 151 6.8. Logistics Management .................................................................... 152 6.9. Benefits of Logistic Management..................................................... 154 6.10. Challenges of Logistic Management .............................................. 155

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6.1. INTRODUCTION The survival of both living and non-living things does rely on the purchase of items that they need. In the early days, human beings practiced barter trade; which involved the exchange of goods. With the invention of money, a common currency allowed the exchange of goods for money. Two terms are commonly used when it comes to conducting such transactions; retailing and wholesaling. Retailing is the exchange of goods and services with consumers; whereas wholesaling is used to exchange goods and services with institutions (Möller & Parvinen, 2015). Retailers serve their final consumers directly; whereas with wholesaling, the final consumer is served indirectly.

Figure 6.1: An image showing a retail shop Source: https://en.wikipedia.org/wiki/Retail

The history of retailing dates back to ancient Greece, when merchants would sell their goods from carts or stalls in the marketplace. In medieval Europe, retailing was a common practice among all classes. The first largescale department stores were developed in England in the 1800s, as well as the concept of shopping on Sundays for those who could afford it. In recent years, retailing has undergone a massive transformation due to technological innovations and changes in consumer behavior. With more people working remotely and online shopping becoming more popular, retailers have had to adapt their business model by offering online sales channels and delivery

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options that allow customers to shop from anywhere at any time, even if they’re not physically in the store (Möller & Halinen, 2018). The history of wholesaling began with farmers who sold their crops in bulk to merchants. The merchants would then sell them at a lower price. The farmers benefited as well because they were paid for their crops before they were even harvested. Wholesaling became more common during the 19th century when railroads were built throughout America. This allowed for faster transportation and distribution than ever before, which reduced costs for consumers. The term “wholesale” comes from this practice of buying and selling in bulk quantities. In Renaissance Italy, wholesalers were called ‘Capitani’ (captains). These captains would travel to other cities and towns to buy up supplies needed by local businesses. Today, wholesalers are still involved in some aspects of retailing, they may purchase goods from manufacturers and then sell them to retailers or other wholesalers.

Figure 6.2: An image showing a wholesale store Source: https://seller.alibaba.com/businessblogs/px001t44y-9-wholesaletrends-you-dont-want-to-miss-out-in-2022

Within the broadest sense, retailing can be said to have started the primary time one item of esteem was traded for another. Within the more limited sense of a specialized full-time commercial action, retailing started a few thousand years back when vendors, to begin with, started selling their products and when the primary marketplaces were formed. As with most other business activities, retailing is amazingly competitive, and the mortality rate of retail foundations is generally tall (Mudambi, 2002). The essential competition is based on cost, but, for brick-and-mortar retailers, those that work inside a physical building, this is often directed somewhat

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by non-price shapes of competition such as the comfort of area, choice and show of stock, engaging quality of the retail foundation itself, and intangible variables such as notoriety within the community.

Figure 6.3: An image showing a brief description of retailing Source: https://pt.slideshare.net/AARTEEROY/lecture-1-introduction-toretailing/2?smtNoRedir=1

The appearance of the Web and its expanding utilize for e-commerce within the 1990s come about in a progressive move in retailing absent from brick-and-mortar stores and toward online retailing, in which clients shop for and buy stock through individual computers, portable phones, or other Internet-connected gadgets. Numerous built-up retailers started offering stock online to clients who acknowledged the comfort of shopping from their homes, whereas unused entirely online retailers and e-malls were. Wholesaling is the selling of stock to anyone other than a retail client. The stock may be sold to a retailer, a distributor, or to a wander that will utilize it for exchange, rather than individual, purposes. Wholesaling customarily, but not in a general sense, incorporates bargains in sum and at a brought that’s through and through lower than the normal retail cost (Mejri et al., 2018). Wholesaling ought to be particularly priceless after the introduction of the mass era and mass promoting procedures in the 19th century. Without markdown organizations, colossal makers would have to showcase their things direct to unimaginable various retailers or buyers at tall unit costs, and retailers or clients would get to deal with a broad number of makers at a mind-blowing burden.

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Figure 6.4: An image showing a brief description of wholesaling Source: https://www.wallstreetmojo.com/wholesaling/

There are three essential categories of wholesalers: the first one is dealer wholesalers, the second one is manufacturers’ bargains branches, and the third one is the stock masters and brokers. The preeminent basic is the shipper wholesalers. These free businesses buy stock in sweeping sums from makers, handle and store that stock, and redistribute it to retailers and others. Manufacturers’ bargains branches are businesses set up by makers to offer particularly to retailers. They tend to be set up by sweeping companies which alter their things as frequently as conceivable and to whom quick, exact information on bargains and propositions for upgrade is especially productive (Leek & Christodoulides, 2011). Stock pros and brokers offer complimentary things from a couple of makers. Not at all like merchant wholesalers and manufacturers’ deals branches they commonly do not take title to the stock they handle. Or perhaps, they organize for rack space and the appearance of stock of the makers they talk to.

6.2 DECIDING ON COMPANY’S MARKET VALUE PROPOSITION 6.2.1. Introduction to Market Value Proposition A value proposition can be displayed as commerce or showcasing articulation that the company employment to summarize why a buyer ought to purchase an item or utilize a benefit. This explanation, in case worded compellingly, persuades a potential shopper that one specific item or benefit the company offers will include more esteem or way better unravel an issue for them than other comparative offerings will.

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Figure 6.5: An image showing a brief description of value proposition Source: https://www.resultist.com/blog/what-is-a-value-proposition

An esteem recommendation stands as a guarantee by a company to a client or showcase fragment. The recommendation is an easy-to-understand reason why a client ought to purchase an item or benefit from that specific commerce. An esteem recommendation ought to clarify how an item fills a require, communicate the specifics of its included advantage, and state the reason why it’s superior to comparable items on the showcase (Di Benedetto & Lindgreen, 2018). The perfect esteem recommendation is to-the-point and offers to a customer’s most grounded decision-making drivers.

Figure 6.6: An image illustrating the main components of a market value proposition Source: https://medium.com/swlh/how-to-identify-your-brands-value-proposition-62611e6c59e4

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The term “value proposition” is thought to have begun with showed up in a McKinsey & Co. industry term paper in 1988, characterizing it as a clear, straightforward explanation of the benefits, both substantial and intangible, that the company will give, together with the inexact cost it’ll charge each client section for those benefits. The company utilizes this articulation to target clients who will advantage the most from using the company’s items, and this makes a difference keep up a company’s financial canal. A financial canal could be a competitive advantage. The canal analogy, coined by super-investor Warren Buffett of Berkshire Hathaway, states that the more extensive the canal, the greater and more flexible the firm is to competition. A company’s value proposition communicates the number one reason why an item or benefit is best suited for a client section. Hence, it ought to continuously be shown unmistakably on a company’s site and in other shopper touch focuses. It too must be natural, so that a client can peruse or listen to the esteem suggestion and get the conveyed esteem without requiring to assist clarification. Value propositions that stand out tend to create utilize a specific structure (Lim, 2018). A successful esteem suggestion ordinarily incorporates a solid, clear feature that communicates the conveyed advantage to the buyer. The feature ought to be a single important sentence, expression, or indeed a tagline. It regularly joins catchy trademarks that ended up a portion of fruitful publicizing campaigns. Regularly a sub-headline will be given underneath the most feature, extending on the clarification of the conveyed esteem and giving a particular case of why the item or benefit is prevalent to others the shopper has in intellect. The subheading can be a brief section and is regularly between two and three sentences long. The subheading may be a way to highlight the key highlights or benefits of the items and frequently benefits from the consideration of bullet focuses or another implies of highlighting standout details. This kind of structure grants buyers to check the regard recommendation quickly and select up on thing highlights. Included visuals increase the ease of communication between exchange and customer. To orchestrate to create a strong regard proposal, companies will frequently conduct exhibit ask around to decide which messages reverberate the foremost great with their clients.

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Value propositions can take after diverse designs as long as they are interesting to the company and the buyers of the company administration. All successful esteem recommendations are simple to get and illustrate particular comes about for a client employing an item or benefit. They separate an item or benefit from any competition, dodge abused showcasing buzzwords, and communicate esteem inside a brief sum of time. For an esteem recommendation to viably turn a prospect into a paying client, it ought to recognize who the clients are, what their primary issues are, and how the company’s item or benefit is the perfect arrangement to assist them to fathom their issues (Dlačić, 2015). A value proposition is implied to persuade partners, speculators, or clients that a company or its products/services are beneficial. In case the esteem suggestion is powerless or unconvincing it may be troublesome to pull in venture and buyer demand. A worker esteem suggestion (EVP) applies to the work advertisement. Here, a company that’s contracting will attempt to outline itself as a great put to work, advertising not as it were financial recompense but to a run of benefits, advantages, and a profitable environment. In return, the job candidate will have to persuade the contracting company that they have the fitting abilities, encounter, mien, and aspiration to succeed. If a company cannot persuade others that it has esteem or that its items or administrations or profitable, it’ll lose productivity and get to the capital and may eventually go out of business.

6.2.2. Categories of Value Proposition The value merely provided can regularly affect your clients on three distinctive levels, technical, business, and personal. Technical value, at the least level, you offer specialized esteem. These are the benefits and improvements in a value recommendation that you simply can provide that make things work superior and are realized in zones like forms, frameworks, and individuals (Gregory et al., 2019). Here are a few cases of conveying esteem at the specialized level: Helping commerce to spare time automating certain manual tasks, improving the execution of framework, forms, or people improving the unwavering quality of the framework, forms, or individuals.

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Figure 6.7: An image showing the types of a value proposition Source: https://www.slideshare.net/sblank/nsf-lecture-2-value-prop/31-Types_ of_Value_Propositions_Comes

Business value. As an exchange begins to realize regard at the specialized level, those benefits will work their way up and make regard at the exchange level. This regard can be seen in zones like salary, costs, and organizations. Here are a couple of cases of businesses realizing regard at the exchange level: Increments in income Advertise share development Enhancement in close rate Diminish in taken a toll of stock sold Diminish in stock taken a toll Diminish in labor costs Enhancement in client fulfillment Diminish in thing transport time (Lambert & Enz, 2012). Personal value. The technical and business esteem that is provided can proceed to work its way up and affect clients at an individual level. Individual esteem can be seen in ranges like wage, career, and work environment. Here are a few cases of prospects realizing esteem at the individual level: Increases in rewards or commissions Improved likelihood for promotion Performance recognition Decrease in workload Decrease in push level Improve work and life balance When one knows the esteem you offer at the three diverse levels, you’ll be able to combine the focuses to form distinctive adaptations of esteem suggestions.

6.2.3. How to Determine Market Value Proposition A value proposition communicates three key things to a customer: Relevance, Value, and Distinction. With relevance, the customers ought to know what your item can offer them. It determines how the company could unveil an

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issue or improve on something in their customers’ life. By recognizing the thing that creates your item or benefits important, one will be able to induce your customers’ consideration and provoke their intrigue in your business. With value, the benefits of the company’s product ought to be determined. By clarifying what makes the company’s advertising profitable, you’ll be able to appear your clients how they can benefit (LaPlaca, 2013). The distinction allows the company to determine why the customers ought to choose their products. That’s another address merely ought to reply. Distinguish the thing that creates your commerce stand out from your competition. The first step to determine a company’s market value proposition is ensuring that the benefits of a company’s services and products are laid out. In the retail and wholesaling world, the products that you sell have to have some sort of benefit. This is not only to keep customers coming back for more but also because it makes it easier for them to justify spending their hard-earned money on what they’re buying. The more benefits your product has, the better chance you’ll have of making a profit. Benefits can come in many forms: price, quality, customer service, convenience, and more. Some products may have all these benefits and still not sell very well because people don’t know about them or simply don’t want to pay extra for those features. If a customer knows about the benefits but hasn’t tried it yet, then there’s no point in making an effort to advertise for it would be like advertising for free beer at the bottom of every ad. When one is selling products, it’s important to establish the benefits of your product or service as soon as possible. If you don’t, potential customers might lose interest in what you have to offer and move on to another product. There are three main ways that you can do this: Make sure that your advertising is clear and concise. Make sure that the ad is easy for consumers to understand and includes all of the information they need about what the product or service can do for them. Make sure that your packaging is eye-catching and appealing (Griffin, 2002). Consumers will be more likely to look at it if they find it interesting or appealing. Try using bright colors or images that draw attention. Create a video or video series about how your product works or what it does for people who use it. Videos are an excellent way to show potential customers how their life will be better with this product in it, or even just explain why they should buy it. The second step is communicating the value of the company’s product benefits to the consumers. There are a lot of ways to communicate the value

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of the company’s product benefits. You can show them how easy it is to make a purchase, or how much money you’ll save if you buy our product instead of another one. You can also explain why your customers will love our product, and why they should buy it from you instead of someone else. You can also use metrics as proof that your products are worth buying. You might also want to use testimonials from previous customers who have purchased your products and found them useful or enjoyable in some way (LaPlaca & Katrichis, 2009). This way, when you’re trying to convince new customers that this is the best thing since sliced bread or whatever sounds good, they’ll already be on board with what you’re saying because they’ve already experienced it themselves.

Figure 6.8: An image showing the value proposition examples Source: https://sixads.net/blog/value-proposition-examples/

The third step is pinpointing the problem a consumer could be facing while using the company’s product. One of the biggest problems that consumers face when shopping for products is having to search through a lot of different options. They might find that they don’t know what they want, or they’re not sure if they are going to be able to afford it. This can make them feel overwhelmed, and it can lead to frustration with the process. One way to tackle this issue is by using a platform. This platform allows retailers and wholesalers to create their stores, but they also have access to an inventory management system, which will help them keep track of everything that’s in stock and who has purchased it (Hinterhuber & Liozu, 2015). This helps both retailers and wholesalers because it removes one of the most common frustrations for both groups: knowing what people want but not being able to get it. After all, there’s nothing left on hand.

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The third step is relating the problem to the value provided by your product or service. Retailers and wholesalers are two different types of businesses. Retailers sell products directly to customers, often in an openair setting like a store or mall. Wholesalers, on the other hand, buy products in bulk and then sell them to retailers at a lower price than they can get them wholesale. Retailers provide value by making sure that their goods are safe, reliable, and durable, they want their customers to feel confident buying from them. They also do everything possible to make sure that customers feel comfortable when they’re shopping. Wholesalers provide value by providing access to products that retailers don’t have access to. The last step is communicating why the company should be chosen to deliver their services or products to their customer. Believing that the am the best candidate for this job because my experience working in retail and wholesaling has taught me how to approach a variety of clients. They have experience working with both small businesses and large corporations, and I can adapt their approach to suit each client’s unique needs. They also have experience working with different management styles, which will help them adapt their management style to fit the needs of each project. Their personal qualities are also very important to this job. The company should be enthusiastic and able to enjoy meeting new people and learning about their businesses. Their interpersonal skills are excellent; and the company is comfortable talking with customers and employees alike, which will help it communicate effectively with them throughout our work together (Lages et al., 2008). The company ought to believe that their skill set makes them well-suited for managing retailing and wholesaling projects because their experience has taught them how to manage people effectively while still being able to follow through on deadlines and get things done on time, something that is essential when running a business.

6.3. SELECTING THE BEST CHANNEL DESIGN FOR RETAILING AND WHOLESALING Retailers and wholesalers are in the business of selling products. They must have a channel design that attracts customers, keeps them loyal, and allows them to reach their customer base. In this section, we will discuss how to channel design can help retailers and wholesalers sell more products at competitive prices. Retailers have the opportunity to optimize their retail space by creating a variety of displays that can help attract customers to the store. There are many different types of displays available today, including

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displays that offer samples of products or provide information about the product itself. Retailers should think carefully about which type of display will be most effective in attracting new customers. Retailers must consider the channel mix for their businesses, as well as how well each channel is performing. The most important thing is to make sure that each channel is performing at an optimal level. If a retailer’s online store isn’t selling enough items, they can look at whether they should focus on more expensive items or less expensive items. They may also want to consider expanding into other channels such as e-commerce or direct mail. Wholesalers should also consider their channel mix by looking at how well each channel is performing overall and determining if they need to make changes based on these results (Hunt, 2013). For example, if a store is located near a college campus where students are especially interested in buying textbooks, then it might be best to present textbooks as an interesting feature on a display rather than putting them on shelves at eye level where they can be easily overlooked by passersby. To keep customers coming back to their stores again and again, retailers need to offer discounts or other incentives that encourage repeat visits by existing customers as well as new ones who may not have been aware of their existence before this point.

Figure 6.9: An image showing channel design process Source: https://www.slideshare.net/NishantAgrawal14/designing-channel-systems-53218088

One’s distribution channel is the arrangement of businesses, vendors, or other mediators your items must go through to reach your last shoppers.

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Depending on your trade and your items, this arrangement can incorporate wholesalers, brick-and-mortar retailers, online marketplaces, or shipping companies that take your items straightforwardly to consumers. Choosing the correct conveyance channel could be an essential choice for your trade. What you select decides how your items are handled, the speed at which they are conveyed, and how effective you’re at getting your merchandise into the hands of buyers. A few times as of late you select a dispersal channel for your things, there are a collection of components to consider. Type of product. On the off chance that your thing is perishable or is uncertain, you’ll require it to reach quickly and in controlled conditions (Lim et al., 2019). You’ll utilize an encouraged transport technique. Market. Knowing who your come full circle clients are will assist you to recognize the primary practical way to empower things to them. Middlemen. Depending on your needs and the requests on your time, a broker can offer assistance to pass on things rapidly and suitably. Whether or not an administrator makes sense will depend on your budget, show-off, and existing commerce affiliations. Once you have got a sense of the sort of dispersion channel that will work best for your business and clients, you would like to choose a particular alternative. Depending on your business and where your clients are found, you’ll require more than one. To select the correct channels, you’ll require to: Consider your competitors. Understanding the strategies your competitors are using. In case there’s a conveyance channel that your competitors have neglected, you’ll pick up an advantage by utilizing it. For case, if your competitors are conveying items through big-box retailers, taking advantage of coordinated deals through the web can deliver you an interesting point. Examine costs and benefits. After choosing a strategy of conveyance, making the bolster frameworks that go with it is time-consuming and costly. Once your company is situated around a particular dispersion channel, it’s troublesome to switch your choice. Carefully weigh the costs and benefits related to each choice sometime recently committing assets to it. Rank your alternatives. After analyzing the distinctive strategies accessible to you, rank them by arranging of inclination concurring to what will net you the most elevated income after the year, short related costs (Lichtenthal & Eliaz, 2003). Select the alternative that permits you to reach the foremost clients while remaining within your budget. Have a growth plan. You’ll discover that seeking after one dispersion channel doesn’t block you from including extra channels as you obtain more capital, or that as your business extends you would like additional

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methods of interfacing clients with products. Keep up together with your advertising and competitors so that you just can proceed to create educated choices approximately conveyance as your advertising grows. The most vital thing you’ll be able to do when choosing a conveyance channel is to carefully consider your choices and not select a course essentially since it’s the industry standard or most helpful road for your commerce. On the off chance that you address the reason behind your choice at the onset, you will find ignored preferences, covered-up downsides, or other ways of coming to clients in a budget-friendly and imaginative way.

6.4. FACTORS TO CONSIDER WHILE SELECTING A CHANNEL OF DISTRIBUTION

Figure 6.10: An image showing a summary of the factors affecting channel selection Source: https://www.slideshare.net/MOHAMMEDAQUIBPATHAN/factors-affecting-channel-selection

6.4.1. Nature of the Product These variables incorporate the physical characteristics of an item and their effect on the choice of a specific channel of dispersion. There are different variables beneath this. Perishable items are dispersed by utilizing a shorter channel of conveyance so that products might be conveyed to the buyers without delay. Delay in the dissemination of these items will break down their quality. Bulky and overwhelming items like coal and nourishment grains etc. are specifically conveyed to the clients including overwhelming

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transportation costs. In arrange to limit these costs a brief and coordinated conveyance channel is appropriate. Items with lesser unit value and tall turnover are dispersed by utilizing longer channels of dispersion. Family items like utensils, cloth, beauty care products, etc. take a longer time in coming to the shoppers. On the other hand, items like gems having tall item esteem are specifically sold to the shoppers by the jewelers. Products of standard measure and quality ordinarily take a longer time by receiving a longer channel of dissemination (Krings et al., 2021). For case, machine instruments and car items which are of standard measure reach the customer through the wholesalers and retailers. Un-standardized articles take lesser time and pass-through shorter channels of conveyance. Mechanical items which are profoundly specialized in nature are more often than not conveyed straightforwardly to the mechanical clients and take lesser time and embrace shorter channels of dissemination. In this case, after deals, benefits and specialized exhortations are given by the producer to the consumers. On the other hand, shopper items of specialized nature are ordinarily sold through wholesalers and retailers. In this way, the longer channel of dispersion is utilized for their deals. After deals, administrations are given by the wholesalers and retailers. A producer creating distinctive items within the same lines offers straightforwardly or through retailers and lesser time is devoured in their dispersion. For case, in case of vehicle elastic items, this hone is taken after. On the other hand, a producer managing as it were in one thing designates sole offering operators, wholesalers, and retailers for offering the item.

6.4.2. Nature of the Market Usually, another factor impacts the choice of an appropriate channel of conveyance. The number of buyers of the item influences the choice of a channel of conveyance. More variables are considered in this respect. Within the case of mechanical markets, the number of buyers is less; a shorter channel of dispersal can be gotten. These buyers customarily clearly purchase from the makers. Displaying arbiters is not required in this case. But within the case of customer markets, where there are a sweeping number of buyers, a longer channel of transport is utilized (Kim & Moon, 2021). Movement dealing with cannot be reasonably carried out without the organizations of wholesalers and retailers. On the off chance that the number of buyers is likely to be more, the scattering channel will be long. On the other hand, if

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the number of clients is expected to be less, the maker can effectively offer particularly to the clients by assigning trade individuals. If the estimate of the arrangement set by the clients is huge, the coordinated offering can be embraced by the producer as in the case of mechanical products. But where the estimate of the arrangement is little, agents are named to convey the products. Where the clients are concentrated at one specific put or advertise, the dispersion channel will be brief and the producer can specifically supply the merchandise in that region by opening his claim shops or deals warehouse. In the case where buyers are broadly scattered, it is exceptionally troublesome for the producer to set up a coordinate connect with the shoppers, and administrations of wholesalers and retailers will be utilized (Iankova et al., 2019). Buying habits of customers: This incorporates the tastes, inclinations, likes, and loathes of clients. Clients moreover anticipate certain administrations like credit and individual consideration and after deals administrations etc. All these variables incredibly impact the choice of dispersion channel.

6.4.3. Nature of the Middlemen Promoting mediators is a crucial component of the dissemination of merchandise. They incredibly impact the promotion of products. A few of the variables related to this are talked about underneath. Taking a toll of conveyance through middlemen is one of the most contemplations to be taken into consideration by the producer. Higher fetched of distribution will result within the expanded fetched of item. The producer ought to select the foremost temperate conveyance channel. In concluding the channel of dispersion, administrations given by the intermediaries must be kept in intellect (Kumar et al., 2020). It may be pointed out that the producer can select a costly showcasing middle person since that will guarantee different showcasing administrations which cannot be advertised by others.

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Figure 6.11: An image showing the types of middlemen Source: https://www.businessmanagementideas.com/marketing/channels/middleman-meaning-importance-and-functions-distribution-channel/11949

In some cases, the wanted go-between may not be accessible for the dissemination of merchandise. They may be active in managing the competitive items. Beneath such circumstances, the producer should make his claim courses of action by opening his branches or deals terminals to disperse the merchandise to the buyers. The promoting arrangements of the producer may not be invited by the agents the terms and conditions may not support the agents. For case, a few wholesalers or retailers would like to act as sole offering operators for the item in a specific range or locale. The manufacturer ought to select those brokers who give different promoting administrations viz, capacity, credit, pressing, etc. At the same time, the go-betweens ought to guarantee different administrations to clients. A producer would like to delegate those go-betweens who guarantee more noteworthy deals volume over the long run (Iglesias et al., 2020). In naming go-between, the producer must take into thought the budgetary steadiness and notoriety of the agent. A monetarily sound go-between can give credit offices to clients and make incite installments to the producer.

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6.5. NATURE AND SIZE OF THE MANUFACTURING UNIT The nature and measure of the manufacturing unit include an incredible effect on the choice of a dissemination channel. Beneath this, there are different components to consider as well. Presumed and monetarily sound fabricating concerns can effectively lock in brokers as compared to lesser rumored and recently built-up units. As a rule, a fabricating unit having a sound budgetary base can effortlessly convey the merchandise without designating brokers by opening their claim deals stations and branches. A fiscally weaker unit cannot work without the assistance of agents. Industrial undertakings having plentiful showcasing capacity and encounter can successfully oversee their conveyance exercises themselves. They have lesser reliance on undertaking mediators. On the other hand, showcasing units having lesser showcasing capacity and encounter depend more on agents for the dissemination of products. A producer may resort to a shorter conveyance channel in arrange to work out successful control over conveyance (Kleinaltenkamp & Jacob, 2002). This can be appropriate in the case of perishable merchandise and is accommodating in setting up a coordinated connection between the producer and the customer. The fetched of dispersion may be more by embracing such a channel of conveyance. Mechanical traditions took after impact the determination of the conveyance channel. In case a specific mode of dissemination is embraced in an industry, the same will be taken after by each fabricating unit in that industry in the dispersion of their products. The determination of showcasing mediators is additionally affected by different administrations given by the producer. These administrations incorporate broad promotion for the item, after deals administrations, and offices of credit. The producers giving these administrations can effectively profit from the administrations of presumed retailers and wholesalers.

6.5.1. Government Regulations Government arrangements and directions impact the choice of dispersion channels. The Government may force certain limitations on the discount exchange of a specific item bone-dry takeover the dissemination of certain items. All these confinements have a coordinated effect in selecting the channel of dissemination.

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Figure 6.12: An image showing an example of government regulations Source: https://slideplayer.com/slide/5285473/

6.5.2. Competition The nature and degree of competition predominant in an industry is another detrimental thought in selecting a dissemination channel. Diverse producers creating comparable items may utilize the same channels of distribution.

6.6. BENEFITS OF A GOOD CHANNEL DESIGN The benefits of a good channel design are numerous. First, it can help manage the risk associated with inventory. If you’re selling a product that might sell well, but only when it’s on sale and there’s a lot of competition, you might find yourself taking more risk than you want to take. When using an online storefront or store-in-store system, you can keep your inventory levels stable by having just enough products on hand to keep up with demand. Second, good channel design can help you scale up faster by reducing costs and increasing efficiency (Johnson et al., 2012). If you’re selling through multiple channels and need to reorder products from a single supplier, or if you have multiple suppliers in different locations, then managing the logistics of getting products from one source to another is much simpler than having to handle them all separately. Thirdly, good channel design can increase customer loyalty by providing targeted promotions based on behavior and feedback from past purchases. You can also use this data as an opportunity to offer additional services or products at lower prices in return for reviews or feedback on your site.

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When you have a good channel design, you make sure that the people who buy your products are the people who will be most likely to use them. That means that you have to make sure that they’re happy with the way they get their products, that they have an easy time finding what they want, and that they feel like they’re getting a fair deal. A good channel design also makes sure that the people who order your products are the ones who will be most likely to use them. This means setting up channels for each type of customer and making sure that those channels are easy enough for customers to navigate on their own, but also providing support if someone needs help or guidance. When you’re looking at a channel design, you want to make sure that the product that you’re selling is going to reach the people who are most likely to buy it. The best way to do this is by making sure that your customers know about your products and what they can do for them. There are several ways to do this, but one of the best ones is through advertising. With advertising, you can reach out to people who are interested in specific brands or services and get them excited about what they could get from your company. Another great way to make sure that people know about your product is through wordof-mouth marketing (Janita & Miranda, 2013). Word-of-mouth marketing works because it gets people talking about products and services with their friends, family members, and coworkers, and when someone tells someone else about something good, it spreads like wildfire. This method is perfect for businesses that don’t have as much money available for advertising campaigns as other businesses might have, which could be why so many small businesses don’t use advertising.

6.7. CHALLENGES FACING A CHANNEL DESIGN The challenges facing a channel design are many, and each channel has its own unique set of challenges. To effectively design your retail channel, you’ll need to understand the different types of channels that exist in the market and how they could affect your business. The primary challenge facing retailing and wholesaling is the lack of adequate supply chain management. Retailers have traditionally focused on building physical stores and online shopping. This approach has left them unable to adequately manage their inventory and track the performance of their business. Wholesalers have traditionally focused on managing warehouses and shipping their goods, but this approach does not allow them to effectively track sales data or optimize product distribution. The first challenge is understanding what kind of

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product you’re selling. You may find that one type of product is better suited for a certain channel than another type. For example, if you’re selling food products and have limited space in your store, it may be more cost-effective to sell those products through a grocery store or mass merchandiser instead of having them on display in your store. Another challenge is understanding how your product will sell itself. Some products simply don’t sell well at all, or only if they’re given away free or heavily discounted, while others have very high demand but don’t make sense to be sold through traditional retail channels because they’re too expensive or too specialized (Yang & Gabrielsson, 2017). A third challenge is finding the right balance between selling too many units at once and not selling enough units at all, which can be especially difficult if you’re new to retailing or wholesaling.

6.8. LOGISTICS MANAGEMENT Logistics management is the administration of supply chain administration capacities that makes a difference in organizations arranging, overseeing, and actualizing forms to move and store goods. Logistics administration exercises ordinarily incorporate inbound and outbound transportation administration, armada administration, warehousing, materials dealing with, arranging fulfielment, coordination organizing a plan, stock control, supply or demand arranging, and administration of third-party coordination administrations suppliers.

Figure 6.13: An image showing a brief summary of what is logistics management Source: https://aims.education/study-online/what-is-logistics-management/

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To changing degrees, coordination administration capacities incorporate client benefit, sourcing, and obtainment, generation arranging, and planning, bundling, and get together. Coordination administration is a portion of all the levels of arranging and execution, counting key, operational, and tactical. Further, it facilitates all the coordination exercises, and it coordinates coordination exercises with other capacities, counting promoting, deals, fabricating funding, and data innovation. Effective logistics administration is vital to companies for several reasons, both positive and negative. Good coordination administration guarantees that items are dispatched in the most prudent, secure, proficient, and opportune way. This comes about taking a toll on reserve funds for the company and more fulfilled customers. In differentiate, destitute coordination administration can result in harmed or postponed shipments, which can at that point lead to disappointed clients, returns, and rejected items (Wang et al., 2008). The results of these issues incorporate higher costs and client connection issues. In arrange to maintain a strategic distance from these comes about, compelling coordination administration includes careful arranging, legitimate software package choice, appropriate verifying and determination of outsourced merchants, and satisfactory assets to handle the forms. Logistics management by and large comprises forms for inbound and outbound coordination activity. Inbound coordination is the method of moving merchandise from providers into a distribution center, at that point into a generation office to create items. Inbound coordinations can incorporate crude materials, instruments, parts, office gear, and supplies. Outbound coordination is the method of moving wrapped-up items out of distribution center stock and shipping them to clients. Logistics processes to incorporate switch coordinations or the administration of all the capacities utilized to return merchandise and materials. Turn around coordination takes products from the client or last goal and returns them to the beginning organization, where they can be reused, repaired, remanufactured, or reused. Logistics management computer program incorporates capacities and forms that empower companies to oversee and execute item capacity and conveyance. Coordinations administration applications run the extent from expansive ERP frameworks that incorporate comprehensive and coordinated capacities to specialized applications that as it was handle many functions. Logistics administration capacities that are a portion of ERP frameworks are usually coordinated with other commerce capacities within

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the framework, like deals, back, acquirement, and human assets. More specialized coordinations administration applications center on stockroom administration, transportation administration, supply chain arranging, and supply chain execution (Wang et al., 2016). Some coordinations administration computer program is planned to be configurable for different businesses, whereas others are pointed at particular businesses. Coordinations administration computer programs for the most part started as on-premises frameworks, but more cloud or half-breed cloud choices are presently accessible.

6.9. BENEFITS OF LOGISTIC MANAGEMENT Logistic management is an important part of retail and wholesaling. It involves managing the supply chain, which ensures that products are delivered to customers as quickly as possible, with as few delays as possible. If a company’s products are not delivered promptly, then they will not be able to sell as many products as they would like. By managing the supply chain effectively, companies can ensure that their products arrive on time, which leads to better sales figures and higher profits. The benefits of logistics management are many: It improves inventory accuracy and utilization, which saves time and money. It reduces waste by reducing spoilage, returns, and returns-related expenses (Voola et al., 2022). It allows stores to have more control over their inventory levels, which means they can make better strategic decisions regarding ordering new products or replenishing depleted stock.

Figure 6.14: An image showing a summary of the benefits of logistic management Source: ment

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6.10. CHALLENGES OF LOGISTIC MANAGEMENT Several challenges arise in managing retail and wholesale distribution networks. These include: (i) Hierarchy: Retailers and wholesalers often have different levels of authority over their operations. This can lead to confusion about who is responsible for which tasks and may result in inefficient processes. (ii) Diversity: Retailers often have a wide range of products to sell, while wholesalers typically only stock one type of product (Veloutsou & Taylor, 2012). This makes it difficult for retailers to know what they need from a supplier, which can lead to poor quality control. (iii) Strategy: When retailers are not sure what they want from their suppliers, they may not ask for it, or worse, they may ask for the wrong thing. This can result in waste because the retailer did not receive what was intended by their supplier or retailer.

Figure 6.15: An image showing a summary of the top challenges of logistics management Source: https://fleetroot.com/blog/top-10-challenges-facing-logistics-companies-in-2019/

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7

CHAPTER

DESIGNING COMMUNICATION AND PROMOTION-MIX STRATEGIES

CONTENTS

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7.1. Strategies of the Promotional Mix ................................................... 158 7.2. What Is the Intention of Your Marketing Mix? .................................. 160 7.3. Your Promotional Combination ....................................................... 160 7.4. Analytic Thinking ............................................................................ 163 7.5. Advertising...................................................................................... 166 7.6. Public Relations .............................................................................. 169 7.7. Sales Promotions ............................................................................ 171 7.8. The Benefits of Using a Marketing Strategy ...................................... 172 7.9. Direct Marketing............................................................................. 173 7.10. Achievement of the Planned Objective ......................................... 174 7.11. Evaluate the Program’s Efficacy and Make Any Necessary Changes ...................................................................... 177 7.12. The Four Ps of Marketing............................................................... 178

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Businesses use the conventional promotional mix, which comprises four fundamental strategies, to make their product or service stand out.

Figure 7.1: Digital marketing concept Source: https://media.istockphoto.com/photos/digital-marketing-concept-online-advertisement-picture-id1284549946?k=20&m=1284549946&s=612x61 2&w=0&h=VVGNI_vARpvpqo2Md_xsfcSiotjVVjzisV75dF15T-0=

7.1. STRATEGIES OF THE PROMOTIONAL MIX Even if your product has a lot of amazing or good qualities, your message may be overlooked if you don’t stress the ones that are vital to your target market or if you overwhelm them with information. Customers are seeking methods to save money; therefore your marketing should cater to that. You choose the most effective marketing strategy (Theron et al., 2008). You must understand how to properly contact your target audience to effectively express your message. If your major clients are manufacturers and your firm produces specialist equipment, advertising in a broad consumer publication is a waste of time and money.

7.1.1. A Guide to the Main Communication Channels

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Publicity: There are several ways to market, and they are all included in the process. This sort of publicity promotion includes advertisements on billboards, radio, and television, in journals and newspapers, and on the Internet. Advertising is a non-personal

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promotional activity since the supplier does not instantly connect with the potential consumer. • Sales promotions: Sales promotion tactics include in-store demos, displays, competitions, and pricing incentives (such as 50% off, buy one, get one free). Governmental rules and Regulations These initiatives aim to increase sales by generating goodwill, attracting attention, and promoting a favorable brand image (Tuten & Urban, 2001). Media coverage, unconventional events, and collaboration with philanthropic organizations are all examples of public relations techniques. Direct advertising includes advertisements that are sent directly to the target audience (typically at their homes or places of business) and encourage the recipient to take action, such as ordering, clipping a coupon, calling a tollfree number, or visiting a store. Direct marketing includes catalogs, discount mailers, and letters. Individual touch between customers and vendors.

Figure 7.2: Books of advertising Source: https://media.istockphoto.com/photos/books-of-advertising-andbranding-in-front-gray-wall-picture-id1140385944?k=20&m=1140385944& s=612x612&w=0&h=L9W5jEddxTIY4ry7u5zFQQ9zvKn0OtZX0WDTjC8bHEc=

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7.2. WHAT IS THE INTENTION OF YOUR MARKETING MIX? If you deliver your message in several methods, you have a higher chance of reaching your intended audience. Only a small proportion of the hundreds of communications sent to your target market each day are effective. Fewer can inspire people to take action as a result. For example, you could wish to tailor your message to a certain market (Theron et al., 2008). If you sell a product to both consumers and experts, you must use a variety of channels and methods to express various messages to each market. You may contact technicians by placing an ad in an automobile newspaper and advertising on television. It is possible to squander your meager advertising budget by selecting an unsuccessful approach at random. If you want to have a meaningful dialog with your main target groups, your promotional efforts must compliment your overall marketing strategy. Beware: Because of their ambition to expand, some owners of rapidly growing businesses forget to connect their marketing strategy to their targeted promotional efforts. Marketing and sales activities that are too expensive without sufficient product testing or pricing are classic errors.

7.3. YOUR PROMOTIONAL COMBINATION How many of these tactics can you employ to determine your company’s perfect promotional mix? Choose a Market Segment Companies to spend on advertising to reach the greatest number of individuals with their brand or product. Television, newspapers, magazines, direct mail, radio, and the Internet may all be used to display advertisements. Sales promotions are incentives for consumers to acquire items and services. Couponing or rebate schemes, as well as public contests and games, are examples of this. The public is made aware of a company’s products and reputation through this type of advertising. Press releases and press conferences are two examples. “Direct marketing” refers to marketing through direct channels such as inperson events, catalogs, emails, phone calls, and mail. Many businesses implement a basic strategy that includes a promotional mix.

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The marketing mix consists of four important components to establish an effective marketing strategy: Consumers pay you in the form of a price for your goods. Spend some time developing pricing tactics that will allow your organization to profit while also attracting new clients. A “product” is any service or thing that meets the demands of the consumer. Market changes may need updates to this. This category includes special discounts, advertising, and other types of sales promotion. The item and its price were created as a result of a promotion (Theron & Terblanche, 2010). Knowing your location is critical for selecting the best area to distribute your items. Learning about the demographics and spending habits of the people in the neighborhood might provide useful information. With the help of an excellent marketing plan, these artists provide the following recommendations to take advantage of a promotional mix: (i) Determine who you want your product or service to reach. (ii) Create advertisements to market your products. (iii) Employ public relations methods. (iv) Utilize sales marketing. (v) Direct marketing is something to think about.

7.3.1. Determine Who You Wish To Sell To Before beginning any marketing campaign, consider your target population. Age, gender, and financial means are all important factors to consider. Marketing success considers your most likely clients. It’s critical to consider whether your product is more suited for males or women, for example. You should consider the probable travel distance for clients when targeting your advertisements. If you utilize these ways to better define your target demographic, your advertising campaign may be more effective. Create advertisements for products and services. Advertising is any type of promotion or presentation of a sponsor’s goods, services, or ideas. Using this strategy is an excellent way to reach a large number of potential clients at once. Advertising through radio, magazines, television, and newspapers can occupy a sizable amount of a company’s budget. You and your team can choose from a range of advertising choices (Streukens et al., 2011). Local newspapers are an excellent medium for advertising things that are likely to be of interest to residents. You may wish to advertise in a few big newspapers or on television to reach as many people as possible. You and your team can revise the advertising as many times as required until everyone is pleased with the outcome. Utilize public relations.

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A company may hire a public relations firm to help with its marketing strategy to influence the attitudes of a certain demographic. The public relations efforts of a corporation frequently help the establishment and maintenance of a favorable company image. Customers, shareholders, environmentalists, workers, politicians, and even labor unions can all be targeted by a company’s public relations efforts. You might work with them to transmit any pertinent facts they should publish, such as your target audience’s demographics. Invite consumers to a special exhibition, for example, where they may see your merchandise. It is advantageous to have a public relations professional on staff since they are in charge of establishing email lists, contacting potential consumers, and responding to general public inquiries about your product or service. As a consequence, your products will be in a good position to be marketed to others, increasing the number of individuals who will buy them (Shaltoni & West, 2010). A sales promotion’s goal is to attract customers to buy your goods or service right away. Customers and dealers can be persuaded to buy your items by offering irregular and temporary incentives such as price cuts, coupons, rebates, or special offers such as buy one, get one free. If a buyer purchased your items within a certain time limit as part of a sales campaign, a discount on the full purchase price would be granted. These goods and services may be marketed in print or online. The promotion may be a discount code that provides 15% off the product if purchased on a specified day. Direct marketing is something to think about. A promotional mix may also include direct marketing to promote a product or service. This method is becoming increasingly popular since it saves firms both time and money. Direct marketing of your products or services to consumers can take various forms. To promote your items, you may distribute leaflets, go door to door, or set up a kiosk at a mall. Customers may have a more delightful and tailored experience as a consequence of this type of marketing (Backhaus et al., 2011). An Introduction to Marketing Mix Formulation To enhance sales and promote the benefits of your company’s products or services to groups of potential consumers. If you want to effectively implant the right messages in the minds of your target audience, you must pay great attention to how you sell your business.

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Figure 7.3: Digital marketing concept Source: https://media.istockphoto.com/vectors/digital-marketing-concept-vector-id483171893?k=20&m=483171893&s=612x612&w=0&h=wy8u47oQsz EtI7seKZL4nm2bdtXkj7vgnGVnJLaytcw=

7.4. ANALYTIC THINKING All products, even the best, require advertising. When it comes to acquiring your product or service, you must first educate your clients. The “promotional mix” refers to the many tactics you use to promote your products and services. Changing your company’s promotional mix for the best results might be difficult. What you should know before you start Persuasion is an essential component of every marketing plan. You’re attempting to persuade folks to buy from you. You must adopt the proper promotional plan if you want to catch the attention of your target audience respectably and engagingly. Make certain they are aware of what you have to offer. You must convince them to buy from you. A promotional mix is made up of five main components (Baumgarth & Schmidt, 2010): advertising or public relations;

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promotion of for-sale goods and services; marketing via direct contact; individual product, and service sales. A multitude of things influence your marketing mix, including the items you’re promoting, the demographics of your target audience, the status of the market, and your promotional budget. Communication will be more effective if it is both appealing and intelligible. Your target market is the group of people who will utilize or benefit from your product or service. Understanding these people’s attitudes and activities will allow you to craft the most effective message and select the most successful form of communication. Based on recent sales or market research, those earning more than $75,000 per year are your ideal consumers for a high-end jewelry firm, for example. As a result, print advertising should appear only in journals with readerships earning at least $75,000 per year (Bendixen et al., 2004). The second stage is to define your objectives. Following the determination of the intended reaction, such as signing up for a free trial of your product or clicking on your Web ad, you must first identify what action you want your target market to do to achieve it. Unfortunately, several business owners fail to clearly express their objectives. With this in mind, you must select the optimal client interaction strategy to increase sales. Sales will come effortlessly if you communicate with your clients correctly. A direct-mail message to potential consumers with a money-saving offer might be part of an efficient direct-mail marketing campaign. Another alternative is to provide a one-of-a-kind deal, such as two things for the price of one. By providing comparisons or client testimonials, you may dispel any misunderstandings about your product that your target audience may have, such as the belief that it is costlier or less effective than rival items. To create specific goals for yourself, fill out the form below. Examine your current commercial scenario to see whether any of the following objectives apply: A completely new product must be launched into a new market. Because my product is being targeted by competing products, I must keep my current customer base. I need to clear any misconceptions regarding my items that individuals may have. I need to enhance brand recognition for my goods. I need to introduce new features to persuade current clients to use them more effectively. I want to increase “buzz” or word-of-mouth advertising. A fresh image of my product is needed. I need to persuade retailers to carry my products or to put larger orders for

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my products. Make your point loud and clear (Sharma et al., 2010). In the design of your communication, you must consider both the substance and appearance of your message. Content. The words and images you use to communicate with your target audience are referred to as content. People will respond to your messaging if you offer them a reason to care. Consider what the most useful aspect of your product will be to a consumer. As a consequence, you should be able to get to the heart of your message. When a person receives a benefit, their desire or need is gratified. A typical reason is the desire to advance in status, save resources such as time and money, or improve security. If you want to get people enthused about your product, demonstrate how it meets a need or produces a good reaction. The message may appeal to the target audience’s need for status, which is probably what motivates jewelry purchasers in the preceding jewelry store example. You might also communicate your sentiments by saying something like, “This ring would be a superb method of displaying your love for her.” Format. Each component of the promotional mix requires a certain structure to work. Personal selling may rely on planned lectures, handouts, and diagnostic tests to engage potential clients, whereas digital advertising largely focuses on visuals. Consider the technical aspects of communicating your content while deciding on the best format. If you want to show a product in motion to encourage clients to buy it, you should surely employ broadcast media in your advertising. As a result, the sound effects, camera angles, lighting, and other aspects will be determined. The print ad structure takes into account the length and breadth of a headline, the usage of graphics, and the sort of imagery that should accompany your message. At this point, you should have decided on your marketing channels. When entrepreneurs fail to fulfill their revenue targets, it’s typical for them to blame inadequate marketing. This is a frequent indicator that a good promotional plan was not developed and implemented (Sheth, 2020). With the appropriate combination of creative and financial resources, you can develop an integrated marketing communications plan that promotes your company’s uniqueness in the eyes of your consumers. Compare the benefits and drawbacks of each of the five marketing methods:

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Figure 7.4: Creative diagram Source: https://media.istockphoto.com/photos/light-bulb-ideas-creative-diagram-concept-picture-id1130023029?k=20&m=1130023029&s=612x612&w =0&h=g196QvvIf7EYNluvl3omcz7iCQImoauXGke-_mW_lAM=

7.5. ADVERTISING Many items from a few decades ago are still used in advertising. When it comes to the selling of commodities, it has been around for a long time. Print, radio, and television advertising as we know it currently bore little resemblance to our novel new strategies. “Sponsored content” or “sponsored advertising” in the advertising sector refers to material or advertising that supports a certain company, product, or service. Advertising must be paid, however public service announcements funded by the media may be allowed under certain conditions. Television, radio, the Internet, magazines, newspapers, and billboards are just a handful of the various advertising platforms accessible. Because of its impersonal nature, it is difficult to elicit a strong emotional response from the audience (Stein et al., 2013). Before transmitting your message, you should observe the audience’s replies. Use marketing to inform your target audience about new products, services, and apps. An “image” appeal can be used to persuade your audience to choose your products over those of a rival. Re-emphasize your product’s characteristics and benefits to your target market. Advertising has several

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advantages. Belief is essential for the fourth and final criterion. Investing in a public presentation of your company and its products may increase your clients’ credibility, tenacity, and dependability. How long has it been since the beginning? It is permissible to repeat a message in important conditions. Repeating your message increases the likelihood that your target customer will notice it when he is ready to embrace it. When it comes to marketing your cause, timing is important. Theatrics. Advertising is the most effective strategy to make a company and its products look more approachable. It might, for example, stimulate people’s curiosity, encourage them to reconsider their opinions about your business, or just entertain or enlighten the intended audience. It might feature photographs and logos to set your organization distinct from the competition. Development. Successful advertising may create and nurture an intangible source of goodwill. To have a competitive advantage in the industry, your company must have a well-known and distinctive name. Advertising is riddled with problems. Costs. Advertising, contrary to popular opinion, may cost less per encounter than other kinds of marketing. Many business owners, on the other hand, do not have the financial wherewithal to engage heavily in public relations. Many small businesses cannot afford the services of a professional advertising agency (Biemans et al., 2010). Start some form of activity. Although attention-grabbing advertising may pique people’s curiosity, even the most inventive marketing strategies are at risk of becoming obsolete. Businesses may also become unduly reliant on advertising, sacrificing more tailored, one-on-one encounters with their target consumers. A scarcity of feedback. Advertising’s success may be difficult to quantify. Some of the most esthetically beautiful television ads may not benefit the advertiser’s bottom line. Customers’ needs are not being considered. Advertisements are becoming easier to ignore as we are bombarded with them throughout the day. Even if you make every attempt to engage your audience, they may turn you down due to misunderstanding and information overload. Internet marketing. This trend is shown by increased internet use and online advertising. By 2005, more than a billion people are predicted to be online. It’s feasible that your company may benefit from using your website to educate customers, gather feedback, and provide online services. However,

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don’t anticipate your company’s visibility to improve as a result of your internet presence (Sivarajah et al., 2020). For effective internet marketing, you may need to pay large websites or online magazines to include your URL or link to your homepage. The following are the most popular types of online marketing: Banner ads (rectangular “virtual billboards”) that connect to your homepage are frequent at the top or bottom of a website. When done correctly, they catch the spectator’s interest with dynamic and bright visuals. CPM, or cost per thousand page views or impressions, is commonly used by banner ad purchasers. CPM expenses can range from $1 for prominent sites to $50 for those with a lesser readership. You may also pay for your ad to appear when someone searches for a certain phrase. It’s critical to consider the “click-through rate,” which is the percentage of individuals who click on your ad relative to the total number of people who see it. The industry has an average conversion rate of about 0.5%, however, it varies greatly depending on the type of business being marketed. In return for a specified sum of money Gateway websites such as America Online, Yahoo, and Lycos are frequently the most popular websites on the Internet. A new firm selling sports memorabilia may find success in the “Sports” section of a massive website. Advertisers may charge a fixed fee or a percentage of ad campaign sales. If you want to establish a more permanent online presence, you may pay to sponsor a website page or a customer-focused email newsletter. PPC (pay-per-click). A variety of search engines and general websites provide pay-per-click advertising. PPC, or pay-per-click, advertising Using affiliates is a risk-free and low-cost way to test the waters of Web-based advertising. Affiliates are paid a proportion of sales generated by a client clicking on their link, which can range from 5 to 15%. When a sale occurs, just the advertising expenditures are spent (Spyropoulou et al., 2010). You have two alternatives for handling this advertising: employ a service bureau for an initial setup fee, or buy software to operate the program yourself and pay your affiliates a portion of your revenue. This sort of email marketing allows you to target clients who have shown an interest in receiving email marketing from businesses similar to yours. According to Larry Chase, editor of “Web Digest for Marketers,” depending on the mailing list and the offer, response rates range from 1% to 15%. The great majority of email answers are received within 48 hours, making advertising campaigns straightforward to analyze. The cost of each name ranges from 15 cents to 35 cents (including postage, printing, and handling),

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making this technique less expensive than direct mail (with its postage, printing, and handling costs). Take care not to include people on your “optout” lists by accident, since they are preferable because they compel them to unsubscribe from your email advertising.

Figure 7.5: Internet advertising Source: https://media.istockphoto.com/photos/internet-advertising-picture-id1 307787976?k=20&m=1307787976&s=612x612&w=0&h=bnAnPyaEiMjXU 7Sdo_yfZ--Yo9NPHGy9wmEopoXIPF0=

7.6. PUBLIC RELATIONS Positive, unpaid media coverage and excellent public relations may boost your company’s reputation and profitability. Public relations helps your company build goodwill by increasing its visibility in the eyes of the general public. Publicity is a bonus to marketing efforts. Publicity may be obtained through press releases, special events, sponsorships, newsletters, and community involvement. Press coverage is the most prevalent type of publicity. You created a revolutionary technology or service that else provides, or • You created a revolutionary technology or service that else provides. It should only be utilized when your organization possesses information, such as whether you have received a major honor or

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known professional distinction (Saura et al., 2021). You’ve made a significant investment in your community by hiring additional people (particularly the elderly, those with disabilities, or those transferring from poverty to work), acquiring property for your new headquarters, or giving items to charity. It has been stated that new board members or executives have been appointed. •

You’ve just purchased a new business. When garnering awareness isn’t an option, but boosting the public impression of your organization is, consider sponsoring a charitable event. A regular newsletter that delivers relevant information to clients is a good approach to enhance sales through improved customer relations and service. The benefits of a public relations approach Sixth, dependability. The majority of individuals see public relations as more trustworthy and compelling than advertising. There are no restrictions on what you may say about your product in advertising. As a result, clients frequently express doubt. Journalists, on the other hand, are under no duty to mention your company favorably in their job. You have no voice in the communication if you are not paid. Employee morale is ranked seventh. Employees can collaborate to promote the humanitarian initiatives of your firm or to arrange community festivals and events. As a consequence of the attention, they may feel more pleased and enthused about their employment. Providing tourists with assurance. Before the Internet, companies would send out press releases on breaking news to catch the attention of newspaper reporters. It is now possible to upload press releases on a company’s website. Using a journalist to include your press release in a news story may not reach as many people, but you will get a competitive advantage (Rusthollkarhu et al., 2022). Internet users who are interested in knowing about new goods, potential expansion, and staff changes may read your company’s press releases. Public relations programs, while less expensive than advertising, may be costly to plan. This includes creating marketing ideas, preparing press releases, and following up with the media. If you pay someone to create promotional materials and arrange events for you, your employees may be diverted from their core duties. Leadership and management that is ineffective. Simply inviting the media to visit your new product or facility does not guarantee a favorable report. Another alternative is to provide incorrect information or omit critical information. Negative publicity may be detrimental as long as it does not outweigh the favorable aspects. When objectives are not met you may put in as much effort as you can to achieve

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the finest possible PR. It’s conceivable that your message won’t reach its target audience. It’s likely that your section may be presented when fewer people are viewing the show, or that your firm will be featured in a brief, seldom-read story in the back of a newspaper.

Figure 7.6: Marketing linear icons Source; https://media.istockphoto.com/vectors/digital-marketing-linear-iconseditable-stroke-campaign-to-promote-vector-id1344077523?k=20&m=1344 077523&s=612x612&w=0&h=spgl-UeyBeLLzKzPCGcv5ZnISl9GIvq1E2XDjAdIxY=

7.7. SALES PROMOTIONS Sales promotions are marketing activities that provide additional benefits or incentives to your sales staff, distributors, or customers. When it comes to consumer-centric sales, it’s all about the customer. It has attracted the attention of potential purchasers. Rapid sales incentives include free samples, discounts, sweepstakes, refunds, awards, and point-of-sale displays. The visual marketing approach of a corporation is crucial. Make use of eyecatching signs, displays, windows, and displays to set your business distinct from the competitors. Trade-focused sales efforts primarily target wholesalers, distributors, and retailers. The trade can stock and advertise your company’s items through price cuts, sales contests, and trade fairs, among

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other tactics. After a few weeks or months, most companies’ sales efforts begin to diminish (Rosenbloom & Larsen, 2003). Advertisers use them to: encourage repeat purchases, divert clients away from competitive items, and convert website visitors into paying customers. Increased corporate stock ownership. Determine whether to deploy a sales campaign based on the likelihood that your target audience would respond positively to it. Sales promotions cannot be emphasized in their value. Coupons should only be used in conjunction with a larger marketing campaign to entice people to switch brands. Experimentation can help you uncover the most efficient sales and marketing strategies. Pre-testing is critical to avoiding costly mistakes. Conduct a test before distributing 50,000 discounted product samples to 100 local grocery retailers. Five businesses should get samples. Before deciding whether or not to conclude the purchase, you must first determine how many coupons have been returned.

7.8. THE BENEFITS OF USING A MARKETING STRATEGY Establish and sustain personal contact Trade promotions compensate middlemen in exchange for product promotion. Offering discounts in return for a prominent shelf or end-of-shelf location can help you build relationships with important players. Set an enticing tone in your surroundings. When customers receive free items for participating in contests, everyone benefits. A transaction can be made more appealing by providing monetary incentives to the winners. Incentives are a crucial component of a successful sales strategy. Consider the price sensitivity of your goods. The reactions of customers to discounts and rebates may help you better understand how price affects your organization. Your knowledge of them may be put to good use in the future by producing more focused advertising attempts. Adversary marketing has a detrimental impact. Errors may occur and even in the middle of fast expansion, many business owners hurry to sell their items before understanding they’ve made a huge error. Poorly thought-out designs, on the other hand, might cause issues (Rosenbloom, 2007). Instead of diving headfirst into sales without first laying the groundwork, it’s wiser to figure out what type of marketing method would work best for your firm. Overconfidence in other people; business executives may concentrate on short-term marketing methods and sales campaigns above longterm, comprehensive operations. After the first rise, promotional revenue increases tend to level out, which can have a detrimental influence on long-

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term brand equity. Underestimating the importance of your company’s brand is a hazardous move. Giving out freebies or samples may undermine a company’s exclusivity or reputation. Customers on a restricted budget may avoid purchasing if there are no incentives.

Figure 7.7: Sales banner Source: https://media.istockphoto.com/vectors/vector-illustration-supersale-banner-template-design-big-sales-end-vector-id1320112973?k=20& m=1320112973&s=612x612&w=0&h=yaMK95E3WKtZM_OakJ8zMKK2f79BS6s3uIo-G9S0QrU=

7.9. DIRECT MARKETING Direct marketing, such as mailing a letter or contacting your consumers, allows you to make a more personal relationship with them. Direct marketing includes telemarketing, direct mail, catalogs, and discount mailers. Direct marketing requires the capacity to create and manage a database of your target demographic. Some business owners consider advertising in a big consumer publication to be a wise investment. Direct marketing, for example, should be included in your promotional mix if: O Your principal distribution method is by mail or directly to clients. Because of the rise of the Internet, many businesses no longer rely on physical sites. Retailers wishing to increase their reach have several alternatives, including online,

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postal, and phone sales (Chang et al., 2018). Databases and mailing lists are required by law for mail-order companies. Direct mail has proven to be a highly successful model of contact for them. O you’re selling things that have multiple benefits. Due to advertising space limits, you may not be able to highlight all of the benefits your product has to offer. All of your benefits might be detailed in a single direct-mail message. Social media may also help with sales events and limited-time offers. Your advertising isn’t reaching the individuals you want to target. High-end jewelry store owners, like yourself, may believe that your advertisement in a high-profile publication isn’t helping their bottom line. You might purchase a list of ZIP codes in a beautiful location. This guarantees that you just concentrate on your intended audience. You’re attempting to market a high-priced product or service. You’ll have to work harder to persuade them to buy expensive items. Direct mail letters reach a far larger audience than traditional types of advertising. o Reorders and/or volume are important in your firm. Magazine publishers rely on telemarketing to persuade their subscribers to renew their subscriptions since they wait until the last minute (Ritter & Pedersen, 2020). A salesman’s reminder calls frequently result in new business. Making the Most of Direct Mail Continuity. By doing early testing and analyzing the findings, a successful direct marketing campaign may be expanded to a larger audience. Strategic sampling can help you reduce your risk exposure.

7.10. ACHIEVEMENT OF THE PLANNED OBJECTIVE Direct marketing allows you to target certain market segments and tailor your message to their specific demands. Measurement simplicity involves measurement of data such as the amount and size of orders, the number of leads generated, and requests for further information, which simplifies the evaluation of direct marketing activities. Negative direct marketing consequences Color saturation is excessive. Many customers are opposed to direct marketing. They are more prone to ignore direct mail, telemarketing calls, door-to-door salesmen, and TV infomercials to avoid them. Direct mail lists that are no longer valid. In this nomadic lifestyle, an increasing number

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of people are migrating often or having two homes. Despite technological developments that allow for the renewal of mailing lists; mailing lists remain difficult to get. A faulty list selection may harm good items, bundles, and bargains. Customers are in great demand. To attract new clients, you must go above and above with your personalized service, whether you promote your business through direct response advertisements, telemarketing, or direct mail (Pires & Aisbett, 2003). Some business owners neglect the need of increasing the number of employees, offer greater training, and deliver better customer service.

7.10.1. Merchandizing for Individuals When sales are done one-on-one, they become more personalized. Salespeople educate, persuade, and remind customers in the same way that ads do. Face-to-face contact may give your organization a distinct personality. The two categories of salespeople are order takers and order getters. Taking orders is a type of creative selling that entails attracting and converting new customers. Order takers are more passive than those who accept orders since they are waiting for customers to come to them. Before you can decide if personal selling should be part of your strategy, your organization model must accommodate a proactive sales staff. Personal selling is the most prevalent technique of selling highly specialized or expensive things. Second, make a budget. It is common practice to estimate your competitors’ promotional budgets and then match them. This is accomplished by keeping an eye on their advertising, promotions, and special events. This isn’t an exact figure, but it’s close. If you discover about your rivals’ advertising budget, you should not imitate them. Use your knowledge as a mentor to assist others. Making a wish list of the tactics you want to utilize to reach your goals is a more accurate approach to estimating your advertising budget (Naudé et al., 2009). Pretend money isn’t an issue. Calculate the financial cost of each action using real-time prices for print and broadcast advertising as well as projected expenditures for sales promotion and public relations. Then reduce the list till an acceptable budget is reached. National broadcast and print advertising may be inadvisable at this time.

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Figure 7.8: Contextual advertising Source: https://media.istockphoto.com/vectors/contextual-advertsing-andtargeting-online-service-or-platform-set-vector-id1251527971?k=20&m=12 51527971&s=612x612&w=0&h=fSurDQ1HPLHEQLkJVn50NPaiv0DFe2g8dzCxbRs-Sj0=

Rather than concentrating all of your marketing efforts on a single place, try a range of tactics. Why? Because promotion involves putting yourself out there. It may take months and hundreds of tests for your firm to discover the ideal success recipe. Prepare to examine your financial condition and make any necessary changes. It is difficult to develop an effective advertising plan when resources are distributed indiscriminately. To gain results from your marketing message, you must promote it regularly. Your message is more likely to be valuable before a consumer purchase if they are frequently exposed to it. Choose the Types of Ads You’ll Run Now that the preceding processes have been accomplished, it is time to develop your actual promotional mix (Michaelidou et al., 2011). The most common statistic to employ when describing your mix is a percentage of your entire promotional spend.

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7.11. EVALUATE THE PROGRAM’S EFFICACY AND MAKE ANY NECESSARY CHANGES You will use sales growth to assess each promotional scheme. Advertising is frequently the most difficult to quantify. Exceptions: Allow consumers to print a coupon or submit a form, or urge radio or television listeners to dial an 800 number. Aside from removing ineffective promotional vehicles, you must also consider growth while changing your promotional mix. After a year on the market, the producer will have to reconsider the formula: Spending Capacity: $10,000 (60%) ads in national consumer and dental journals across the country a 40% discount on a $6,000 purchase Sales marketing includes things like free product samples, coupons, and point-of-purchase displays (Möller & Parvinen, 2015). Observation: Since the novelty of the goods has worn off, public relations have been removed from the equation. This corporation is spending more money on advertising to reach a broader audience throughout the country. Because dentists frequently promote the firm’s products to their patients, the business recognized that marketing to dentists was vital to its successful sales efforts. $4,000 Business Marketing Plan Example: Precious Beings Offering Pet Sitting Service—Workers who visit people’s homes feed and exercise their pets, and replace their litter boxes. •

People who work long hours and have little time to spend with their dogs; • People who are going on vacation but do not want to kennel their pets and do not have someone to stay at their home. Persuade customers to move from our competitor’s service to ours; have veterinarians recommend our service, and have at least one veterinarian agree to treat our clients’ pets in an emergency, something competitors do not provide. These are only a handful of the objectives we’ve set for ourselves. The following elements comprise the design message: You can rely on us if you’re concerned about your pet’s safety while you’re away. Given how simple and inexpensive our services are, you can’t afford to use them. Ads in newspapers and Yellow Pages, pamphlets, and flyers Publicity Techniques: Local newspapers and yellow-page ads Discounts and Special Offers One day is free or greatly reduced in price after 20 punches for coupons with perforated holes. Governmental rules and Regulations Nothing matters right now. We want to contribute a part of our profits to an animal refuge as the firm grows. Posters were mailed to veterinarians, nursing homes, and pet

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firms (Claycomb et al., 2005). As the firm grows, it will send out a newsletter to its consumers.

Figure 7.9: A man on a call Source: https://media.istockphoto.com/photos/shot-of-a-businessman-usinga-computer-while-working-in-a-call-center-picture-id1331493599?k=20 &m=1331493599&s=612x612&w=0&h=aQEATi7xriiYY0m2NSQAEl3o22b4D0976lfiUbZkAM=

7.12. THE FOUR PS OF MARKETING How Do the Marketing Four Ps Work? When advertising a product or service, the four Ps must be considered: product, pricing, promotion, and placement. This list also includes an item’s price and location. The four Ps of marketing is referred to as the “marketing mix.” When marketing a product, all factors are considered, including what consumers want, how the product or service fulfills or fails to fulfill those needs, the product’s perception in society, how the product or service stands out from the competition, and how the company that makes the product interacts with its customers. Since the four Ps were initially introduced in the 1950s, further Ps have been added, including people, processes, and physical evidence. It is critical to understand the four Ps of marketing. In the 1950s, Harvard advertising professor Neil Borden popularized the marketing mix and the four Ps principles (Möller & Halinen, 2018). He discussed the many ways

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enterprises may engage their target consumers through advertising strategies in his 1964 essay, “The Concept of the Marketing Mix.” 1 Decade later, businesses are still marketing their products and services utilizing Borden’s notions. Others in the business improved Borden’s ideas over several years. E. Jerome McCarthy, a marketing professor at Michigan State University, expanded on Borden’s concepts and popularized the phrase “four Ps” marketing. McCarthy’s co-authorship of the book Basic Marketing:

Figure 7.10: Discount banner Source: https://media.istockphoto.com/vectors/mega-discount-with-up-to50-percent-price-off-vector-id1318440943?k=20&m=1318440943&s=612x6 12&w=0&h=CtejzPKJZ2PLdHdcNrGg9tfzqakK6WWQ7MSIUvzm1UQ=

A Managerial Approach contributed to the idea’s popularity. 2 When the notion was initially suggested, businesses were able to bypass physical boundaries that would otherwise limit product dissemination. In recent years, the Internet has helped to relieve some of these issues. People, process, and concrete evidence are extensions of the original Four Ps that are relevant to current marketing trends. The four Ps of marketing can be stated as follows:

7.12.1. Product A deep understanding of the product itself is the cornerstone of every effective marketing plan. So, what’s the big deal? What sets it apart from the competition? People may feel tempted to purchase something new because

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of its appealing look or use. When a product is sold, the marketer must communicate the benefits of the product to the buyer. The specs of a product influence how it is disseminated. Marketers must understand that businesses must have a plan in place to manage commodities throughout their life cycle. A product’s kind determines its pricing, placement, and promotion. Several well-known companies are among the product’s early adopters (Mudambi, 2002). The iPhone was introduced by Apple as the first smartphone with a touchscreen that could make phone calls, play music, and connect to the Internet. Apple anticipates that iPhone sales will exceed $71.6 billion in the first quarter of 2022. 3 Apple anticipates that two billion iPhones will have been sold by the end of 2021.

7.12.2. Price The price of a thing is decided by how much money potential buyers are willing to spend on it. Supplier costs, seasonal reductions, competition, and retail markup must all be considered when pricing a product. Business decision-makers may boost the price of a product to make it look more premium or exclusive. They may also cut the price to entice more clients. To make matters even more complicated, marketers must determine whether or not to make offers available at all. A discount might increase sales, but it can also make a product less appealing. UNIQLO, a maker of casual clothes, has its global headquarters in Japan. Gap and Zara are two of the world’s most popular clothing shops for young people. Unlike its competitors, UNIQLO’s goods are distinguished by their inventiveness and a high degree of workmanship. This is accomplished by purchasing in bulk and seeking the greatest bargains on the lowest-quality items. As a consequence, the firm may deal directly with its suppliers and develop strong relationships with innovative Japanese suppliers. UNIQLO also uses the services of thirdparty manufacturers (Mejri et al., 2018). They have the option of switching production partners if necessary. To ensure quality, the corporation sends a team of highly qualified textile craftsmen to various partner organizations across the world. Quality issues are handled once a week at the plant level by production supervisors.

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7.12.3. Place Product placement refers to the product’s online and physical presence, as well as how it is displayed. Making the right choice is critical: Sephora and Neiman Marcus, rather than Walmart or Family Dollar, are preferred locations for premium cosmetics companies. Business owners are constantly looking for new ways to market their products to reach as many potential customers as possible. This simply entails placing a product in a limited number of retail locations and ensuring that it is displayed attractively. When we talk about “placement,” we mean promoting a product in the best possible location to attract potential customers’ attention. Aston Martins were not seen in the first James Bond film, Golden Eye, which was released in 1995. Pierce Brosnan, who plays James Bond in the film 007, stepped out of his BMW Z3. Although the Z3 did not hit the market until months after the film’s release, BMW received 9,000 orders in the month following its debut (Leek & Christodoulides, 2011).

7.12.4. Promotion Customers must be persuaded that these things are required and that the price is reasonable for advertising to be effective. Promotion involves all facets of a product’s introduction, including public relations, advertising, and the overall media mix. Marketers usually employ a combination of positioning and marketing to reach their target population. When it comes to digital marketing, location and promotion are just as important as they were in the past. Product-specific search phrases, such as those seen on a company’s website or social media. In 1980, just 10,000 cases of Absolut vodka were sold in Sweden. By the year 2000, the firm had sold 4.5 million cases as a result of its well-known advertising campaign. In terms of marketing imagery, the brand’s characteristic bottle was turned into a variety of mystical artifacts, including an amulet, stone bottle, and a ski slope forest in the shape of an amulet. Absolut’s campaign ran from 1981 to 2005, making it the world’s longest-running continuous promotion.

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Figure 7.11: A woman shouting megaphone Source: https://media.istockphoto.com/photos/pretty-young-woman-shoutingin-megaphone-on-pink-background-picture-id1311792652?k=20&m=13117 92652&s=612x612&w=0&h=-r6GzSSX_1_qi4KIFwZbJfmPCKLAFy9tm2xwDMPdSaY=

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8

CHAPTER

IMPLEMENTING MARKETING PROGRAMS

CONTENTS

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8.1. Who Are The Client Personas Aimed at By Your Marketing Campaigns?.................................................................................. 185 8.2. The Advantages of an Effective Marketing Implementation Strategy . 186 8.3. Setting Realistic Expectations for Marketing Strategies..................... 186 8.4. Setting Objectives and Implementing Five Different Digital Marketing Strategies ..................................................................... 187 8.5. Social Media Marketing .................................................................. 188 8.6. Emailing Prospective Customers ..................................................... 189 8.7. Review of the Marketing Plan ......................................................... 190 8.8. Examine Your Marketing Strategy .................................................... 191 8.9. Identification of Resources .............................................................. 194 8.10. Getting Project Planning Software................................................. 196 8.11. Documentation of the Marketing Strategies................................... 197 8.12. Establish Content Objectives for Each Phase ................................. 198 8.13. Plan the Amplification Channels ................................................... 199 8.14. Create a Publication Schedule ...................................................... 200 8.15. The Benefits of a Documented Market Strategy ............................. 200 8.16. Creating Workflow ........................................................................ 201 8.17. Method for Creating Workflows .................................................... 201 8.18. Managing Marketing Project ......................................................... 205 8.19. Measuring Results ......................................................................... 208

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Your marketing execution strategy directs your marketing personnel. Furthermore, it depicts the future marketing landscape. A marketing implementation plan organizes everything into a logical sequence by using marketing procedures, sprints, checklists, and marketing templates. This ensures that your team can work together cohesively and establish a good marketing process that will assist your company in reaching its target market. A creative marketing plan does not always improve a company’s marketing performance. It is dependent on how marketing personnel carry out the strategy. A well-planned, inefficient method will be successful, but inefficient. Adopting a poorly defined approach will be efficient, but not effective (Chang et al., 2012). Businesses must be both effective and efficient to maximize their performance. You’ve created an excellent product or service; now you must devise a marketing strategy. Your marketing strategy outlines the strategies your company will employ to reach new customers, outperform competitors, and position your brand. There are numerous methods for marketing your product or service, but each requires a strategy for implementation. It is the execution of a marketing strategy. This includes gathering the necessary materials and creating a marketing calendar. Creating an execution plan for your marketing campaigns is an important part of marketing planning because it ensures that everything goes as planned. A marketing plan may include, among other things, Internet advertising, email marketing, content marketing, social media management, and events. Marketing plans come in a variety of shapes and sizes, but they all share three key components:

Figure 8.1: Strategic marketing program Source: https://www.istockphoto.com/photo/brainstorming-concept-sticky-notes-strategy-note-in-woman-hand-gm1137920337– 303600936?phrase=marketing

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Marketing Objectives: Define the objectives of your marketing plan and their relationship to your organization’s strategic objectives. Market Research: Determine your target clients, competitors, and other market elements.

8.1. WHO ARE THE CLIENT PERSONAS AIMED AT BY YOUR MARKETING CAMPAIGNS? •

Key performance indicators (KPI): Every marketing plan includes KPIs that can be used to measure the plan’s success. • Marketing team: To achieve your goals, form a marketing team. • Marketing budget: Create a marketing budget to track the resources and expenses associated with each marketing activity (Lim, 2018). • Marketing tactics: Some marketing initiatives may employ multiple marketing techniques at the same time. It is now time to put your marketing strategy into action.

8.1.1. What Exactly Is Marketing Execution? Marketing implementation is the process of putting your marketing plan into action. To do so, you’ll need a marketing implementation strategy. It addresses the actions and resources required to put your marketing strategies into action. A marketing implementation plan, like any other project plan, describes the campaign’s objectives and the activities required to achieve them. It is used to define deliverables and evaluate scope (Lambert & Enz, 2012). Every assignment should have a deadline, and you should identify potential risks and devise mitigation strategies for them. Define team members’ roles and responsibilities, as well as resource management and communication procedures.

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8.2. THE ADVANTAGES OF AN EFFECTIVE MARKETING IMPLEMENTATION STRATEGY Marketing is a critical component of bringing a product to market. It allows you to organize your marketing strategy into a series of processes. The calendar is uncertain without a marketing implementation plan, and activity quickly spirals out of control. It’s the same as wasting money. Furthermore, when an execution strategy is in place, marketing personnel are more focused on their task. It assists people in prioritizing their work so that the most important tasks are completed on time.

8.3. SETTING REALISTIC EXPECTATIONS FOR MARKETING STRATEGIES Myths abound in the world of digital marketing. Some people believe that by using this “magic wand,” they will be able to generate instant sales and revenue. Others see this as a methodical approach that will ultimately pay off. Expecting immediate increases in sales revenue is unrealistic, so you risk being disappointed and missing out on a great opportunity to increase your market share. Your online or digital marketing objectives should not detract from the subject’s complexity. Assume you’re running an experiment with hundreds of variables that could affect the outcome (LaPlaca, 2013). Variables must be optimized at each stage. According to the graph above, more than half of all small businesses are dissatisfied with their digital marketing efforts. It’s obvious if they didn’t set realistic expectations or successfully implement a digital marketing strategy. If your initial digital marketing efforts were a failure, you should rethink your strategy. Even if you fail, you should be able to improve your skills in the future by learning from your mistakes. However, it is more likely that the company’s digital marketing strategy has failed to establish any realistic goals. It can take anywhere from six to twelve months to see the full impact of a digital marketing campaign if the right strategy is implemented from the start. This post explores a problem that brands and business owners should be aware of to understand and set realistic expectations for digital marketing performance. You should be aware that dissatisfaction with digital marketing is common. The majority of small businesses believe their digital marketing investments are not profitable enough. The widespread misconception that digital marketing is free has tainted it. Even if organic digital marketing

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is an option, there will always be a need for paid staff, content creation, and technology use (which typically costs money). All of this implies that if you want to be successful in digital marketing, you must invest money. The organic social media traffic is almost extinct, and organic search traffic is declining (LaPlaca & Katrichis, 2009). Many small business owners are unable to set realistic goals for their digital marketing efforts due to limited budgets. As a result, by setting themselves up to fail, people set themselves up for failure from the start. Making good decisions about which techniques to keep and which to discard requires being practical and logical.

8.4. SETTING OBJECTIVES AND IMPLEMENTING FIVE DIFFERENT DIGITAL MARKETING STRATEGIES SEO is everything (search engine optimization).

Figure 8.2: Internet marketing Source: https://www.istockphoto.com/photo/internet-marketing-andw e b - a n a l y t i c s - s e o - s e a rc h - e n g i n e - o p t i m i z a t i o n - g m 1 2 0 2 2 0 5 5 2 2 – 345046706?phrase=seo

SEO is one of the most widely used digital marketing strategies. Efforts to improve your website’s search engine rankings are explained in simple terms.

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Content creation, link building, and website optimization based on Google guidelines are all common SEO techniques. Additionally, SEO services are not cheap. Keyword tools, for example, are essential for search engine optimization, as are constantly tracking your progress. Use the compound interest analogy as a guide when developing realistic SEO expectations. You must understand that SEO efforts take time to develop and that you will not see immediate results. This means you’ll have to wait at least six months before seeing a return on your investment (Lages et al., 2008). SEO helps your business achieve long-term success and higher conversion rates by attracting natural visitors to your website. A fee for each click is used to fund public relations. Search engines and social media platforms encourage businesses and government agencies to invest in advertising to increase website traffic and engagement. Organic reach has decreased significantly, particularly on social networks that rely heavily on advertising. PPC, or payper-click, is a type of paid search that makes use of platforms such as Google Ads or similar platforms on other search engines such as Bing. In contrast to organic search engine optimization, pay-per-click advertising can produce results almost immediately because visibility for your company begins as soon as a budget and advertising are established. Because of the costs, this is not a long-term strategy for small businesses. While PPC is significantly less expensive than traditional advertising, you must allocate a significant budget if you want your ads to appear near the top of paid search results, especially if your quality score is low. PPC is a great option for short-term campaigns, especially during the holidays (Lim et al., 2019).

8.5. SOCIAL MEDIA MARKETING

Figure 8.3: Social media marketing Source: https://www.istockphoto.com/photo/social-media-marketinggm943037488–257697849?phrase=social%20media%20marketing

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Every year, billions of hours are spent on social media sites such as Facebook, TikTok, and others. A company would be foolish to ignore this. Social media has captivated a sizable portion of the population. To meet your financial objectives, you’ll need to invest in paid advertising on social media platforms like Facebook and Instagram, where organic reach is nearly non-existent. Social media is frequently used in the early stages of a customer’s experience. As a result, the reach, participation, and comparable KPIs of SMM campaigns are frequently sought (Lichtenthal & Eliaz, 2003). Incorporating influencers and user-generated content is an effective strategy for improving your social media marketing results (UGC).

8.6. EMAILING PROSPECTIVE CUSTOMERS

Figure 8.4: Email marketing Source: https://www.istockphoto.com/photo/hand-of-female-checking-application-email-on-smart-phone-notification-new-messagesgm1174915666–326954878

Many businesses may overlook email as a marketing and sales tool. Email marketing remains the most powerful digital marketing strategy. A successful email marketing strategy begins with a thorough understanding of your target audience and continues with the establishment of a relationship with them via relevant and timely communications. Your email marketing campaign will be a success almost immediately if you use the right subject lines and promotions. Spammy features should be avoided at all costs (Cortez & Johnston, 2017).

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These platforms welcome questions and criticism. Today’s audiences’ tastes are far more refined than those of just a few years ago. Product marketing that minimizes their experiences is also a source of annoyance for them, particularly when it occurs on social media. As a result, many people turn to sites such as Reddit, Quora, Medium, and Question Hub to find information that is both authentic and free of commercial influence. Brands and agencies should be as authentic as possible on these platforms. One of their many responsibilities is to assist others in developing their sense of authenticity. This lends weight to the argument. Making money on these platforms takes a significant amount of time, effort, and skill. This project will take at least six months to complete. Consequently, it would be nearly impossible to discern all of the background activities at any given time (Krings et al., 2021). There is still a lot of work to be done before digital marketing can be considered an exact science rather than a bunch of guesswork. As a result, many people describe digital marketing as a combination of art and science. We wrote this article to assist brands in setting realistic goals for their digital marketing efforts. If you require assistance with a specific issue, please let us know in the section below.

8.7. REVIEW OF THE MARKETING PLAN

Figure 8.5: Team reviewing a marketing plan Source: https://www.istockphoto.com/photo/business-casual-team-working-ongraphs-gm1059661834–283245781?phrase=review%20marketing%20plan

The majority of marketing plans begin with a review of current market conditions. This analysis typically includes the product’s sales trend,

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competitive position, previous promotional support, market strengths and weaknesses, and market strengths and weaknesses. Creating a marketing strategy is not a one-time project with a clear end goal for the majority of professional service firms. It is an iterative process when it comes to adding new components to the system, improving existing ones, and possibly eliminating ones that aren’t working well. The complexity of developing a system, the need to change and adapt, and the fact that marketing is typically carried out by a multitalented individual all contribute to the need for an iterative process (Kim & Moon, 2021).

8.7.1. The Advantages of Conducting an Annual Marketing Strategy Review Your assumptions in developing your strategy may turn out to be overly optimistic. If your strategy calls for two original blogs per week but you can only post one, you should reconsider your priorities and strategy. A solid marketing strategy should guide your company’s marketing efforts.

8.8. EXAMINE YOUR MARKETING STRATEGY You have complete freedom to change your strategy at any time. We recommend having regular meetings with your company’s key decisionmakers to review your progress. Here are five methods for keeping your plan up to date.

1. Examine long-term performance trends to determine whether your strategy is effective. Your marketing strategy should be examined one by one, and any areas that require additional research should be noted. Check the budget, timeline, milestones, and/or benchmarks to evaluate performance. It is up to you whether or not you met your objectives. What gives if this isn’t the case? If a failure to meet a benchmark was caused by an external factor, changing the strategy may not be necessary (Kumar et al., 2020). If your workload, experience, or job responsibilities prevent you from meeting the requirements, consider modifying the standard.

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2. Prepare for Unexpected Changes and Modify Your Strategy

Figure 8.6: Performance of implemented strategies Source: https://www.istockphoto.com/photo/colleagues-are-stress-talking-about-the-results-report-and-compared-with-the-gm1169476198– 323303344?phrase=review%20marketing%20plan

In most cases, your original strategy will not have worked perfectly. After determining what works and what doesn’t, adjustments can be made. Consider your own and your colleagues’ decisions, as well as those of other key decision-makers. Changing the frequency with which information is posted, implementing a new approval or communication process for specific jobs, or increasing or decreasing the budget based on actual results are all options (Kleinaltenkamp & Jacob, 2002).

3. Create New Metrics to Assist You in Meeting Your ROI Objectives

Figure 8.7: Illustration on ROI Source: https://www.istockphoto.com/photo/return-on-investment-concepts-business-success-invester-plan-profit-and-growth-gm1225955717– 361039327?phrase=roi

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What would success look like if these changes were made to the plan? It is critical to keep track of your progress toward your objectives. Setting new standards will not only aid in the success of your strategy but will also encourage everyone on your team to take ownership of their work. If at all possible, keep these benchmarks visible to the entire team. Giving your employees constant reminders of how they will be judged is an excellent way to keep them motivated.

4. Implement Your New Marketing Strategy Strategically

Figure 8.8: A marketing strategy Source: https://www.istockphoto.com/photo/sharing-ideas-concepts-withpapernote-writing-strategy-on-wall-glass-office-business-gm1074983828– 287770039?phrase=%20marketing%20strategy

Once the necessary changes and benchmarks have been established, you can begin implementing the new strategy. It may be necessary to change your budget, start new projects, or reassign your employees to new roles. Communication will be your most valuable ally in ensuring that your new approach is successfully implemented (Johnson et al., 2012). Explain to your team why certain elements have been changed, how the new standards will be monitored, and the team’s specific role in ensuring the marketing plan’s success.

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5. Make Time to Evaluate Marketing Strategies

Figure 8.9: Evaluating a marketing strategy Source: https://www.istockphoto.com/photo/woman-sketching-a-businessplan-at-a-creative-office-gm912338074–251168099?phrase=%20marketing%20strategy

It is simple to put off the implementation of a new marketing strategy. As part of the review process, we recommend scheduling your next review appointment. If you schedule a future review session, you will be more likely to stick to your plan.

8.9. IDENTIFICATION OF RESOURCES By creating a marketing plan, you can define your strategic direction and ensure that marketing helps you achieve your goals. A marketing plan can help you determine the resources you’ll need to achieve your objectives. Only by knowing what resources you will need will you be able to properly implement your marketing strategy. Don’t just look at the money; consider the personnel and skills required. Determine the key indicators that will be used to evaluate the success of marketing initiatives, and ensure that all relevant personnel are aware of their responsibilities (Janita & Miranda, 2013). Everyone is worried about the costs involved. This is because it is assumed that communication tool expenses are “all over the place.” A website can cost $50,000 or nothing at all. That could be difficult to navigate. Another issue is the limited amount of marketing funds available. Because

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no organization has unlimited marketing resources, they always try to reach as many people as possible with their message. Time is a valuable marketing resource that is frequently underutilized. Money is sometimes used to replace time. That is, businesses look for ways to leverage their own time to reduce project costs. That’s good... committing time to a project, whether planning or manufacturing, can help a company save money. However, we frequently underestimate our available time. Time management is also essential in initiatives such as social media, public relations, and email newsletters (Iglesias et al., 2020). Time and money are the other two resources. Expertise – People’s knowledge is limited in time. Many businesses hire talented specialists who are eager to assist with marketing. They want to take part. That’s fantastic! Creating a list of marketing-related individuals (who aren’t always from the marketing department, if one exists) with the knowledge (and time) to assist in developing the plan, producing the communications, and managing the implementation is one of the project planning steps in the Genius Marketing process. The tools that support a communications plan are built using a company’s knowledge. A corporation can save money by enlisting the help of others who can promote the company with their skills and interests. It aids in the expansion of the fourth critical resource (Iankova et al., 2019). I sometimes refer to energy as “will.” It refers to a company’s ability to market itself. Although it’s exciting to think about how much time and talent we can devote to internal marketing, it’s better to look into professional services if we’re bored. Engaging others can help to boost energy levels. However, because of other factors, a corporation may use less energy. People’s energy levels will drop if their obligations are already overburdened and marketing activities are added to the mix. People will not have the energy to focus on marketing if there is a planned workplace relocation, new building, or other significant change. Even if they want to participate, their motivation and energy for marketing efforts will be sapped by other obligations. As a result, it’s more than just money at stake. All four components must be considered as part of a corporation’s marketing project resources. Genius Marketing works with businesses to create a strategy that combines readily available internal and external resources. A clear plan for how all of these resources will be integrated not only improves project success but can also help to reduce costs (Hunt, 2013). An effective plan and process mapping result in the proper allocation of internal and external resources, yielding

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a “budget” that includes non-monetary factors. If you want to see results from the technique you’ve chosen, you must put your marketing strategy into action. Make sure you execute by allocating the resources necessary to achieve this goal.

8.10. GETTING PROJECT PLANNING SOFTWARE

Figure 8.10: A project planning software Source: https://www.istockphoto.com/photo/project-manager-usinggantt-chart-tasks-planning-and-scheduling-computer-gm844437488– 138178745?phrase=project%20planning%20software

Project management software, such as Project Manager, makes implementation planning much easier. Access to a variety of online resources you can use Gantt charts to plan and execute your implementation strategy. A single chart can be used to assign tasks, connect dependencies, and track progress time. Aside from the traditional Gantt chart, our project management software offers four additional project views: task lists, Kanban boards, calendars, and sheets (Hinterhuber & Liozu, 2015). Kanban boards can be used to create agile workflows. Columns can be used in a variety of ways to fit your content creation process. As a result, the board’s viewpoint favors a more flexible working style. When the content team can see their workflow in action, they can better manage their backlog and determine which tasks are most important, and management can better deploy resources to keep the team productive.

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8.11. DOCUMENTATION OF THE MARKETING STRATEGIES

Figure 8.11: Documents in files Source: https://www.istockphoto.com/photo/edge-of-open-book-pagesgm519476132–90550335?phrase=documentation

More than two-thirds of the most successful content marketers use this strategy, while only 13% of the least successful do. This is essential for content marketing to be successful. That one thing is the creation of a written content marketing strategy, which is used by only 37% of B2B content marketers. That’s all there is to it. If you plan and document your strategy, you have a much better chance of running a successful content marketing company. A written strategy forbids the creation of unplanned content. As a result, it is easier to gain the support of the entire team. It establishes measurable goals and a strategy for achieving them at the outset of any content initiative. Simply put, it streamlines and improves the creation and dissemination of information (Griffin, 2002). If your team wants to compete with the best content marketers, you must formalize this strategy. This is a good place to start. Consider why as a starting point. What are the advantages of content marketing for your business? What is the significance of the content you intend to create? Customer research can help you identify gaps in your content’s value proposition that need to be filled.

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8.11.1. Begin by Defining Some Broad Objectives After you’ve determined the purpose of your content, be specific about its function. In other words, the goals of your content program should range from getting people to notice your brand to make them loyal to it. This technology will eventually serve a variety of business goals, including lead generation, cost per lead, and marketing-supported sales. Be specific about the metrics that will be used to assess these objectives (Gregory et al., 2019). Don’t be concerned if your objectives change as you put the strategy into action. It is preferable to start small and take action rather than attempting to predict the future. The outcomes of your execution may necessitate changes to your strategy. To achieve better results, it should be constantly evolving.

8.11.2. Make a List of Your Potential Customers Who is your neighborhood content’s intended audience? What is the motivation behind their actions? What effect do they have on the decisions made? What information sources do they use for their research? Are they currently using any of the platforms listed below? The answers to these questions will assist you in developing content creation and distribution strategies. Create in-depth profiles of your ideal customers.

Creating Content for Each Stage of the Buyer’s Journey. Spiral, funnel, or even being late for dinner are all metaphors for the three stages that comprise the buyer’s journey. TopRank Marketing refers to these strategies as “attract, engage, and convert.” Without a strategy, the majority of businesses waste money on ineffective content. A lot of good information with a clear path to follow may also be beneficial. You need a well-rounded strategy that includes all three stages (Dlačić, 2015).

8.12. ESTABLISH CONTENT OBJECTIVES FOR EACH PHASE These objectives serve as a precursor to the larger business objectives I previously mentioned. They, like general objectives, should be stated in measurable terms and accompanied by measurable metrics. Goals and metrics for each stage are provided below as examples. Attract: Increase public awareness of the company’s brand. Metrics such as page views and social shares must be tracked to improve search engine visibility. Metrics for keyword and content rankings:

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1. •

Engage: Goal: Encouraging Audience Participation. Likes, shares, and clicks are examples of metrics. • Goal: Increase the number of fans. Metrics such as gated downloads, social media followers, and newsletter signups are used. 2. Convert: • Goal: To obtain MQL. This application tracks metrics such as leads converted to SQL, contact forms completed, and gated downloads. • •

Goal: To assist with sales. Metrics to consider include contract size, sales cycle time, and conversion rate.

8.13. PLAN THE AMPLIFICATION CHANNELS

Figure 8.12: Airhorn Source: https://www.istockphoto.com/vector/loudspeaker-line-icongm1170312952–323798831?phrase=airhorn

Avoid postponing the amplification process until your content is complete. Allow customer research to inform your paid and organic activities. Now is an excellent time to start using influencer marketing.

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8.14. CREATE A PUBLICATION SCHEDULE You can use an editorial calendar to combine long-term goals and short-term objectives into a single, manageable strategy. Using it as a guide, your team can decide what types of content to create, when to produce it, and how to distribute it. Curata has provided several editorial calendar templates for your convenience. Feel free to try out a few of these and choose the one that best suits your needs. You can create and implement a content marketing strategy by following these seven steps. Your first draft is unlikely to be flawless, but that doesn’t mean it shouldn’t be. At the very least, you will have a solid foundation upon which to build (Di Benedetto & Lindgreen, 2018). Simply by having a well-defined content strategy, you’ve risen to the top third of marketers. If you stay focused on your goals and adjust your strategy as you go, your potential is limitless.

8.15. THE BENEFITS OF A DOCUMENTED MARKET STRATEGY Marketers who have a formalized content strategy are more likely to: Be more optimistic about the potential of content marketing. Some aspects of content marketing may appear to be simpler to master than others. 2. Examine how businesses can improve their content marketing strategies. 3. Can increase their content marketing budget. Setting goals is a common practice that can make or break a project. Having goals in your head but failing to write them down is insufficient. If you record the events as they happen, you have a 1.2–1.4 times better chance of success. It is believed that writing down your goals increases the likelihood that they will be remembered. This makes it easier to remember them and keeps your attention on what’s important (Dowell et al., 2015). Developing a content strategy is the first step toward content marketing success. You can influence the outcome by employing the proper strategy. No, I would not attempt to memorize a map depicting a difficult route to my destination. Alternatively, would you rather carry a map with you to keep track of where you’re going?

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8.16. CREATING WORKFLOW Workflows are predefined activities or sequences that are carried out following a predetermined set of rules to complete a business process. One of the primary advantages of implementing a workflow is that it ensures that documents and information are quickly transferred between participants, automating some or all of the business process (Chang et al., 2018).

8.17. METHOD FOR CREATING WORKFLOWS

Figure 8.13: Work flow illustration Source: https://www.istockphoto.com/photo/flow-chart-gm155067590– 17702529?phrase=workflows

8.17.1. Determine The Order In Which You Will Use Your Resources Understanding how existing processes work is the first step in re-creating and optimizing them. Is keeping track of a project’s progress solely on paper? What about email chains and online forms? What happens to the signed and completed forms? A workflow’s resources include, in addition to forms and operating procedures, the individuals involved in the process. To begin, speak with the process owners to determine what is wrong with the current method. If you’re creating a budget approval app, speak with your finance department to learn how they currently manage the process manually (Davies et al., 2010). Determine what people want from an online workflow and then implement it.

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8.17.2. Make a List of Everything That Needs To Be Done

Figure 8.14: Making a list Source: https://www.istockphoto.com/photo/young-woman-working-at-homegm1082009990–290167466?phrase=make%20a%20list

Less structured workflows have a linear path of tasks to complete, whereas more structured workflows require a graph-like series of tasks to be completed in parallel or conditionally before moving on to the next phase. It is critical to understand how work is completed and what data is passed back and forth. A policy for approving travel reimbursements, for example, requires the manager to obtain spending information from the initiate (Yang & Gabrielsson, 2017). The data cannot be changed by the manager or anyone else. All rejected claims must be returned to the requestor with a reason, but accepted claims with an approval letter may be forwarded to the finance department for processing.

8.17.3. Determine Who Is In Charge of What At Each Stage

Figure 8.15: Concept of leadership Source: https://www.istockphoto.com/photo/global-communication-networkconcept-leadership-of-business-teamwork-management-gm1254000773– 366387630?phrase=in%20charge

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Consider who will be involved in completing this assignment after conducting an in-depth analysis. Certain projects can be moved forward right away, while others require approval or study before they can move forward. As quickly as feasible, compile a list of all the participants, their specialized roles, and the information they require to complete the work (Wang et al., 2008). Give each task its function and delegate responsibility. An employee may need to be authorized to begin the leave request process (input job), but the manager merely needs to approve or reject the request based on pre-set criteria (approval task). Personnel in HR and finance, for example, May be pleased with simply seeing the status of permission.

8.17.4. CREATING FLOWCHARTS OF THE PROCEDURE

Figure 8.16: A chart flow Source: https://www.istockphoto.com/photo/business-process-and-workflowconcept-gm1162297462–318755308?phrase=flow%20charts

Once you’ve completed your preliminary research, you’re ready to start drawing out workflow diagrams. Using a workflow diagram, you can see the entire process in action. Workflow management platforms that allow the building of processes using drag-and-drop tools are preferable to those that do not. Regardless of the complexity of the process, you should select a program that is easy to learn and can be customized to create a digital version of the paper-based workflow (Backhaus et al., 2011).

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8.17.5. Assess the Process You Developed Is this the final step in setting up the workflow? I’m sorry, but no. You can’t make the switch to an online workflow without first conducting a thorough test. From the outside, it may appear as if every workflow is spotless. Its flaws won’t be discovered unless it’s put through rigorous testing. Instead of executing this stage on your alone, collaborate with the other participants in the process. Identifying problems and figuring out what works and what doesn’t will be easier with their help. Make use of their feedback to improve and adjust your automated process.

Tell Everyone In Your Company About The New Process. Nothing is certain, not even with a flawless workflow. Doing so is a fact of life. However helpful people have been in terms of recommendations, development, and testing, they may be reluctant to give up their longstanding habits. The majority of it stems from a lack of confidence in one’s abilities as a result of anxiety over the unknown (Wang et al., 2016). They will no longer be apprehensive about implementing the new workflow because of the successful training program. Students will better understand the objective of the process, the position of each phase, and its function if you share the “create workflow” procedure and your workflow diagrams with them.

8.17.6. The New Process Flow Must Be Installed Testing and training have made your process ready to go into production. Securely deploying the workflow to a small team and continuously monitoring it is advised. It is up to you whether or not you want to proceed with the adjustment and inform the rest of your organization of the results. Whenever a new need emerges, simply go back to where you left off and start over. You have the choice of releasing a new version or regularly updating an existing one in the event of policy changes or new requirements. Doing so is a great way to save time and money. Complex business procedures can be simplified by using workflows, which reduce the complexity of everyday operations and increase the overall efficiency of a method. Additionally, workflows have many other advantages, like the ability to link data fields to a master dataset. There are several reasons why workflows are important:

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• Simplify the process by making it easier to follow. • Get rid of any obligations that aren’t necessary. • Identify bottlenecks and gaps in the workflow. • Ensure that everyone is held accountable. • Do not micromanage your employees. • Throughout the entire process, be upfront and honest. • Boost cooperation among team members. • Provide more in-depth business data. From the beginning, creating a workflow might be tough. One of the challenges for a process designer is to keep the bigger picture in mind while fiddling with forms and conditions. An understanding of the entire process is vital before searching for the right instrument to construct a workflow (Voola et al., 2022).

8.18. MANAGING MARKETING PROJECT Throughout a project, marketing project management keeps marketing campaigns on track and stakeholders informed. As a result, teamwork improves, projects stay on track, and customers’ needs are better met. Project management methods and procedures differ from one organization to the next. Following that, the following are the necessary steps to take: Each stage of a project is distinct from start to finish. This will be influenced by the project’s predetermined timeline and budget. The primary goal of the project is to produce specific outputs known as “project deliverables.” A deliverable is typically the final product that a client receives after the completion of a project. This could be a single blog or an entirely new marketing strategy. Tasks are divided into manageable chunks. This includes task lists, tasks, subtasks, and project milestones. When evaluating projects, the company’s long-term goals are taken into account. In the context of marketing, this could be part of a branding or content marketing campaign. A project management solution is used to manage the project (Veloutsou & Taylor, 2012). A digital workspace provided by project management software makes it easier to keep track of tasks and communicate with colleagues. A good project management structure can be used for any type of marketing activity or campaign, regardless of the context. Paid search, email marketing, and SEO are just a few of the ways you can promote your company online, in addition to product and brand efforts.

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Project management, for example, could be used to coordinate the numerous marketing tasks associated with a brand campaign. Your team can include graphic designers, copywriters, market researchers, and strategists. Marketing project management consists of five distinct steps. In marketing, there is no such thing as a “one-size-fits-all” strategy. Despite this, marketing projects can be divided into five stages. • The first step is to prepare. As a first step, key project stakeholders from the executive suite to marketing will establish and agree on goals and objectives. If you work for an agency, there will be a lot of cross-pollination. It’s worth noting that 52% of marketing experts have difficulty explaining strategy to people who aren’t experts in the field. This is a reference to the importance of project deadlines to clearly define objectives, goals, and deliverables (Theron et al., 2008). Long-term goals include “improving the customer experience” and “increasing brand awareness.” Objectives, on the other hand, provide a more detailed description of how to achieve these goals. Increasing our net promoter score (NPS) and/or creating more content are two examples. A project charter is built on objectives and goals. Work on the project can begin once all relevant parties have signed this paper. There is complete agreement. Following that, it is up to the project manager to determine what is required to meet the project’s objectives. The following is the project’s next step. The first stage of the project cycle is known as “planning.” Once the goals have been established, team members will be able to agree on a budget and deliverables. A deliverable is, once again, anything that is required for the successful completion of a project. The most common deliverables for marketing initiatives are campaigns and major components such as advertising, graphics, and blog posts. Members of the team collaborate to create a marketing project plan that includes a variety of tasks. The greater the project’s complexity, the more tasks that must be completed (Tuten & Urban, 2001). Each task is then assigned to a team member. Key stakeholders may assign temporary tasks to team members. In other situations, team members may choose to work independently. This varies depending on the squad. The project shown below is a good example of one that necessitates teamwork. Each task is assigned to a single person on the team, and each has its deadline, time budget, and priority. It is critical to have these tasks in place before proceeding with any project.

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Figure 8.17: Concept of teamwork Source: https://www.istockphoto.com/vector/business-concept-teammetaphor-people-connecting-puzzle-elements-vector-gm1281819457– 379745356?phrase=teamwork

Furthermore, the project scope is established during the planning phase. Here’s a quick rundown of the project’s requirements. By defining the project’s scope of work, you can ensure that teams don’t take on too much while staying within budget. 2.

Another important activity at this stage is the creation of a project timetable. The project’s flow will be defined in this step. Gantt charts, which can be updated in real-time, can be used to visually depict how a project is progressing. The project teams are ready to get started now that they have a plan in place (Theron et al., 2008). 3. The third stage is implementation. During this phase, the team’s plan is put into action. Team leaders must establish task management expectations during execution. Tasks are tracked and reported on, new ones are added as needed, and if a project becomes stagnant, action is taken. Kanban boards are a popular method for keeping track of your team’s work and providing participants and stakeholders with a quick snapshot of where the project is at any given time. Kanban boards are ideal for promoting project management because they display the project’s stages (e.g., drafts, revisions, etc.). When your task card has progressed, you can see it by moving it to the appropriate column (Theron & Terblanche, 2010). Kanban boards, for example, can help team

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members feel more responsible and autonomous. As a result, everyone benefits: project managers always know where their initiatives stand, and participants can work without interruption. 4. The final stage is known as control. Once a project has begun, it is entirely your responsibility to see it through to completion. Is there anyone on the team who has appeared in the media? Is there a backlog of work on the project? The project manager’s role is to identify and correct problems with a project. It is also critical that they keep the project’s stakeholders and participants informed. To ensure that all of these tasks are completed as quickly as possible, communication consolidation is required. Teamwork can once again provide a consistent platform for making adjustments, allocating new dates, and setting new due dates. Marketing project management knowledge has numerous benefits. One of the most obvious advantages of project management is increased efficiency. Consider the following additional factors when making your decision: 1.

Independent of project, team or client, clear, repeatable procedures promote more consistent work. 2. Teams are encouraged to communicate with one another, empower one another, and move projects along as quickly as possible. 3. When everything is open and visible, it’s easy to see who’s doing well and who isn’t. 4. Organization: fewer assumptions, fewer check-ins, and no missed deadlines. Careful planning yields more significant results than winging it. It is preferable to plan everything ahead of time rather than relying on a hunch.

8.19. MEASURING RESULTS The marketing plan of a company outlines its sales strategy. They are subject to change or revaluation based on market fluctuations and include all relevant data for the next year. To meet the needs of the company and the needs of

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the customer, the marketing strategy should be reviewed, examined, and adjusted regularly (Streukens et al., 2011). By learning how to determine if your marketing strategy is producing the best results possible, you can save time and money while ensuring the success of your business.

8.19.1. ROI (Return on Investment)

Figure 8.18: ROI illustration Source: https://www.istockphoto.com/photo/cost-value-matrix-graph-businessconcept-gm1193782223–339697506?phrase=roi

The return on investment (ROI) is an important consideration in every business decision. Determine whether or not your marketing strategy was a success. The cost of each campaign must be balanced against the revenue generated. It will be easier to identify successful and unsuccessful marketing campaigns if data is broken down by campaign type. The information provided can be used to calculate a total measurement (Shaltoni & West, 2010).

8.19.2. Investigating Sales Records Looking at the numbers is the quickest and easiest way to determine the success of a strategy. Because last year’s $100,000 and this year’s $150,000 sales were generated by the same marketing strategy, you may conclude that your current marketing strategy is effective. Even after accounting for price increases and business expansion, you’re still selling more than a year ago.

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8.19.3. Customer Opinions and Feedback

Figure 8.19: Customer feedback Source: https://www.istockphoto.com/photo/customer-experiences-conceptwoman-using-mobile-phone-to-giving-feedback-via-the-gm1272205043– 374541514?phrase=customer%20feedback

You can learn more about the types of responses your campaign generates by examining all forms of consumer feedback. By conducting online and inperson surveys, general customer service reviews, and online conversations, you can learn what your target audience thinks of your marketing efforts and which campaigns are the most successful (Baumgarth & Schmidt, 2010). How did you hear about our holiday sale? May reveal which marketing methods are effective and which market segments drive purchases.

8.19.4. A Larger Marketing Audience If your marketing reach is expanding, the success of your plan is most likely to blame. Businesses and experiences that are successful and wellliked spread their message to new locations, which is a sign of success and a message that is beneficial in marketing. The increase in your marketing budget is another sign that your strategy is working.

8.19.5. Marketing Department Participants Your marketing strategy will benefit from feedback from your marketing partners. It’s critical to solicit feedback from your business partners on how well you’re doing in terms of their brands, suppliers, and vendors. Because they are more frequently on the front lines and have more direct contact with customers, they are more likely to see the benefits of a well-executed

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campaign. The unfavorable press is treated similarly. When asked when new marketing initiatives will be launched, it may be time to rethink your marketing strategy.

8.19.6. Responses from Outbound Salespeople The success of outside sales agents can be used to measure the effectiveness of marketing. Request feedback from your soldiers in the field to determine whether the message you’re sending and the methods you’re using to deliver it is effective. If the feedback is negative or customers are unaware of your most recent marketing efforts, you may need to change your strategy to better target current consumers and meet the demands of your sales team (Bendixen et al., 2004).

8.19.7. Competing Behavior The actions of your competitors can often reveal whether your marketing strategy is a success or a failure. This strategy can be effective if your competitors are attempting to imitate or outdo you. If your campaigns are generally ignored or receive an immediate negative response, there may be a problem or cause for concern.

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9

CHAPTER

CONTROLLING MARKET ACTIVITIES

CONTENTS

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9.1. Market Control Techniques ............................................................. 216 9.2. Behavioral Analysis (Customer Buying Criteria) ............................... 218 9.3. Behavioral Analysis (Purchase Process and Patterns)........................ 220 9.4. Customer Demographics ................................................................ 221 9.5. Testing Research.............................................................................. 222 9.6. Controlled Experimentation ............................................................ 223 9.7. Observational Studies ..................................................................... 224 9.8. Correlation/Causation ..................................................................... 225 9.9. Non-Experimental Designs ............................................................. 225 9.10. Survey .......................................................................................... 226 9.11. Case Study/Casuistry ..................................................................... 226 9.12. Qualitative Analysis ...................................................................... 227 9.13. Customer Feedback ...................................................................... 228 9.14. Complaints ................................................................................... 230 9.15. Types of Marketing Control ........................................................... 232 9.16. Management by Objectives; the Heart of Annual Plan Control...... 233

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Control of market activities can be defined as actions performed to: (1) establish the rules for participation in the market; or (2) influence price, quality or product positioning. The control of market activities is a critical aspect in developing a marketable product. Market Participants such as manufacturers, distributors, producers, retailers and consumers play a pivotal role in the success of a product (Sharma et al., 2010). The principal focus of controlling market activities is to create an environment which would promote competition and prevent monopoly.

Figure 9.1: The process of market control and evaluation Source: Image by iEduNote

It can also be termed as a set of business activities, for example, sales, manufacturing, distribution and research and development. These activities are managed to closely monitor their performance and ensure that they do not get too out-of-sync with the overall goal of company’s plan. This will help to improve efficiency of overall business operations. It is important in that it would give a good idea of the nature of the company’s products, or services. In addition, this measure reflects how well the company is able to control the market by buying from competitors and not from others who could be more responsive to their needs. The term “market activities” refers to the financial market, which is the most used and important market in the world today. This term describes the different type of financial transactions that takes place in a market. The financial transactions are not only commercial but also stock trading,

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derivatives and even money lending, which are all part of controlling market activities (Sheth, 2020). A market activity is similarly a discrete transaction or set of transactions, such as trading in securities during the day or buying coffee maker sets during Black Friday, where firms’ decisions affect changes in the supply and demand of product.

Figure 9.2: Modern day market activities are majorly embedded in financial services. Source: Image by Marketing 91

Controlling market activities are the major drivers of business performance. They can be the most important contributor to profitability, but they also make the biggest difference in a company’s ability to control costs by controlling product development and production, by controlling production facilities and operations, by controlling inventory levels and purchasing efficiency, or by controlling sales activity. A market’s overall performance is influenced by many factors and described as the result of a process, which controls the activities and actions of participants in the market. A number of events occurring within a market may have an impact on its development, these can be identified as controlling market activities (Biemans et al., 2010). The concept of controlling market activities is about making the production and distribution of a product more efficient. This helps to improve sales and reduce the costs involved with marketing a particular product or brand. By controlling these activities, you have more control over the sales process and can increase profit due to reduced inventories, which means less time being spent on inventory management and transportation.

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For example, a company may launch a new product or service that competes with existing ones on the market, or it may seek to enhance its brand image by adding a new merchandising channel. Other objectives include; satisfying consumer demand; allocating resources; improving efficiency of producers and distributors; providing financial returns to all participants; creating incentives for production and investment, as well as indirect benefits such as national prosperity, employment and improvements to quality of life.

9.1. MARKET CONTROL TECHNIQUES Marketing control techniques are used to help companies determine how to reach their target market. Marketing tools can include social media, search engine optimization and SEO, email marketing, online display advertising, blogs and video and more. These particular techniques determine the way products are marketed and sold (Stein et al., 2013). The basic approach is to make a product marketable by selling it to customers using different versions of the product whose characteristics are changed or enhanced in some manner.

Figure 9.3: An overview of some of the common market control techniques Source: Image by iEduNote

In order to successfully market a product or service, it is necessary to have a plan and will to make that plan work. It’s not enough to simply write copy, or create promotional literature. It takes a whole lot more than that. Marketing tactics like advertising and public relations are only part of the process; there are many other methods which are equally important in the

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marketing mix. Marketing control techniques are considered to be the most effective means to assist with reducing waste of money, time and other resources. The goal is to tailor the product offering to satisfy customer needs and expectations, as well as develop a message that resonates with them as an individual or company. Marketing control techniques are the first step in product research, usually involving several different marketing strategies before a product can be launched. These particular methods influences moods, feelings and ideas about products in order to increase sales (Sivarajah et al., 2020). The most popular form of marketing control is product placement – for example, companies can create advertisements where brands and products appear as if they were being used by ordinary people in everyday situations. But how do these techniques get attached to market control? The objective of marketing control is to set strategic objectives and then to define ways in which these can be attained. It also includes determining how a company will design its product or service, formulate pricing strategies, make decisions on which distribution channels to use and even how it will define its key messages. Some of the common market control techniques include;

9.1.2. Customer Analysis Customer analysis is a process of gathering information about your customers, focusing on their needs and preferences. Customer analysis is the most important and demanding part of marketing control. This is because it involves understanding your customer’s needs, wants and preferences. By using this knowledge, you can create new products and services which will align with their desires (Chang et al., 2018). Customer analysis involves the gathering, summarizing and analyzing of customer feedback data. These data can be used for marketing purposes and to identify problem areas within the business. Customer analysis needs to be performed regularly so that problems are identified quickly.

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Figure 9.4: Customer analysis allows the company to gather information about particular users Source: Image by Marketing 91

Customers are built over time and so it’s essential to understand your customer base as they evolve. Analysts use data available in CRM and other sources to determine what their customers are thinking, buying and doing. Customers are always looking for new ways to make their life easier, so if you have an innovative product or service that can help them with that, then you have a shot at becoming successful. The process of customer analysis involves identifying and analyzing the customers’ needs, price sensitivity and preferences. This method is often used by retailers to help make products more attractive in terms of pricing and marketing (Spyropoulou et al., 2010). Various markets utilize customer analysis to determine your current brand strengths, weaknesses and competitor threats. Identify what you can do better to improve your competitive position, as well as identify new opportunities for future sales growth.

9.2. BEHAVIORAL ANALYSIS (CUSTOMER BUYING CRITERIA) Behavioral analysis is the process of gathering data, analyzing it, and then applying it to specific problem-solving activities. The primary method of behavioral analysis is focused on understanding what customers think, feel

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and do. In short, behavioral analysis looks at how customers interface with your product or service by studying how their buy decisions are made.

Figure 9.5: Companies can analyze the behaviors of their customers and use those behaviors to perfect their service delivery Source: Image by WP ERP

Customer buying criteria is a behavioral analysis of the customers’ needs and wants, as well as their best fit/match with a product or service offered by an organization. For example, if a customer complains that his car is always doing ‘noisy,’ this behavior might suggest that he has some specific needs (e.g., power windows) that are not being met by his current vehicle. The behavioral analysis consists of identifying the customer buying criteria used by customers, which are shown in a table. The buying criteria for products can be classified into four main sections that are based on different categories or groups: personal, environmental, ethical, and social products. In customer buying criteria, behavioral analysis is concerned with consumer decision-making processes. Behavioral researchers study how consumers make choices in trying to achieve their objectives. The researcher may be interested in finding out if the consumer makes the right choice, or if they made an error in judgment based on inaccurate information (Saura et al., 2021). The three customer buying criteria are: quality, price, and value. In order for a product to be successful it must meet all three criteria. The behavioral analysis process allows us to understand the motivations and behaviors of current and potential customers. It also helps guide our marketing strategy by identifying which products or services appeal to

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various customer groups and what features might be most important in those products.

9.3. BEHAVIORAL ANALYSIS (PURCHASE PROCESS AND PATTERNS) Buying a product can be approached using two methods. The first is to use a series of patterns to analyze a customer and find out what they will buy next. To do so, industries ask questions that are generally easier for customers to answer than business problems. Current transaction data of customers will be used to identify the buying process and provide an insight into the customer behavior. This provides a glimpse into how people use products and services, as well as what motivates them to purchase. It also gives insights into how to improve our processes for responding to customer inquiries; in this case it is about increasing response rates from 15% to 50%.

Figure 9.6: The process of behavioral analysis Source: Image by BC Open Textbooks

The behavioral analysis of a customer is a broad concept that involves knowing the purchasing behavior of a particular person, or group of people, who use your product or service. For example, what jobs do they hold? How much money do they make? What are their age and gender profiles? Identify your customer behavior and preferences to better understand his

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or her buying habits. The information gathered here can help to determine product offerings and pricing, along with marketing promotions and communications plans in order to meet the needs of specific segments of customers (Rusthollkarhu et al., 2022). It takes an individual to become a good buyer. In order to know if a person has the buying power or not, one should analyze his behavior and purchase process habits. He may have given up on purchasing a product because he is unable to get it at a rate that he likes through traditional channels. This can be a good thing for the company as there could be demand for special promotional deals or coupons etc. The seller can then come up with marketing campaigns that are customized to meet such demands.

9.4. CUSTOMER DEMOGRAPHICS Customer demographics determines how a customer uses or interacts with a product/service. Customer demographics is comprised of age, gender, location and income. Customer demographics is the key to understanding how customers behave and respond. Customers can be grouped into four different categories: differently aged, older, younger, and middle aged (Rosenbloom & Larsen, 2003). Using customer data for each of these categories can outline how customers see you or your products better than those who aren’t in those specific groups.

Figure 9.7: Some of the important info gathered on customer demographics Source: Image by Question pro

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9.5. TESTING RESEARCH Control techniques are used to make sure that what you’re testing has a high chance of working. You can test your product or service by using different control methods to make sure that your final product delivers on the promises you make. Testing is a market control technique that allows producers to engage in price discrimination by charging different unit prices for similar products. A company that is willing to invest in research and market control has a significant advantage over its competitors. One way to ensure their success will be to monitor market conditions, identify changes in the industry, and determine whether these changes affect their business. This testing research as a market control technique strategy has helped many companies succeed and improve their performance.

Figure 9.8: Step by step market research Source: Image by Relevant Insights

The increasing importance of consumer and user research in marketing strategies has resulted in the widespread use of testing research as a technique for generating information on consumer needs, perceptions and behaviors. This has also been associated with a commitment to continuous improvement in all aspects of market research. As a consequence, testing research is now being used increasingly in many areas to further our understanding of consumers’ attitudes and intentions (Rosenbloom, 2007). It is important to maintain a continuous and rigorous testing program as a way to reduce risk. Testing is the process of applying a number of leading edge (e.g., what we think are most likely) and counter flow (what others think are not so likely) theories to test new approaches, products and processes.

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Ways of testing research are: (1) controlled experimentation; (2) observational studies; (3) correlation/causation; (4) non-experimental designs; (5) survey; (6) case study/casuistry; and (7) qualitative analysis. Testing research aims at constructing a model or hypotheses; the conditions should be implemented to verify the conception. This can be done through experimentation, observation, and collection of data. The comparison of model outputs with actual outcomes is used to validate the model. When one is conducting a research, there are a few methods which can be used depending on the type of question which needs to be answered. There are multiple ways in which one can test any hypothesis and get a valid result for it.

9.6. CONTROLLED EXPERIMENTATION In controlled experimentation as a way of testing research, the researcher is careful to avoid any variable that may lead to unreliable results. In controlled experiments, an idea or hypothesis is tested through a variety of possible variables such as treatment, feedback, or experimenter influences. The design and analysis of studies explicitly involves the process of deciding how to measure, how to define and how to randomize. In doing so, a level of control is built into the process that is required to guarantee validity (Ritter & Pedersen, 2020). The “control” in controlled experimentation is not an element added to the research but becomes part of it. It comes from having a theoretical scenario that sets out how participants will be studied, how they will be used, what they will be asked to do, what results are expected and possible consequences as well as from having a series of operational definitions that are kept in mind when designing each stage.

Figure 9.9: Controlled experimentation represent the analysis of a market in which all elements are kept constant except the independent variable Source: Image by VOXCO

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9.7. OBSERVATIONAL STUDIES Observational studies are a way of testing research. The best feedback on analysis and results is gained through people who have no stake in the outcome and are not part of the experimental process. It examines what happens, rather than what is expected to happen. Unlike a laboratory experiment, an observational approach does not involve manipulating variables in order to test hypotheses (Pires & Aisbett, 2003). However, researchers still need to be very careful about how they identify and collect their subjects for the study.

Figure 9.10: An imagery of observational study/research Source: Image by Market Business news

Observational studies have been used for years to test hypotheses, and there is little argument over its effectiveness. Observational studies are not perfect, but they are the standard in most areas where no physiological measurements or measurement on the effect of a drug is possible. The method of observational studies is a non-experimental way of testing research. Observational studies use information that is collected without the intervention of any treatment or impact on the participants. Observational data can be gathered through interviews, questionnaires, and examination of records. Despite their simplicity, they also make an essential contribution to science by providing access to information about relationships between variables that cannot be obtained by any other method. These are not standard clinical trials as they do not include all possible contingencies, nor do they follow a set design. Observational studies only allow an assessment and comparison of two different outcomes being measured over time (Claycomb et al., 2005).

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9.8. CORRELATION/CAUSATION Correlation uses one variable to predict the value of another variable. The prediction is based on correlation/causation past data; therefore it is not a good predictor of future events. Causation is the association between two variables that does not appear as an association when examining past data. It is a statistical technique to determine if the association between two variables is due to chance or whether there really is a link between them. In other words, it tests whether the presence of one variable in your dataset leads to the presence of another variable. This can aid the researcher in finding out what causes what and why – this is how scientists get closer to discovering the truth behind their subject matter.

Figure 9.11: The aspect of correlation; prediction Source: Image by Digs.net

9.9. NON-EXPERIMENTAL DESIGNS The use of non-experimental designs has been increasing in popularity over the past decade as they provide a way to control variables, or generalize findings from one group to another. Methods that make use of nonexperimental design are often described as being type I errors, since it may be easier to identify a true effect than to reject a null hypothesis. In nonexperimental designs the researcher isn’t able to control the environment in which the participants participate. This means that the setting and the way people are participating is different from what it would be if they had been given other options (Naudé et al., 2009). The advantage of these designs is that they allow for an unbiased view of people’s behavior or opinions,

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but they do come with limitations. This method can be used in order to test hypotheses or as an exploratory test before doing a more focused study.

Figure 9.12: Research study involves both experimental and non-experimental studies Source: Image by iEduNote

9.10. SURVEY Surveys are a useful way of testing research, providing information about the perceptions and beliefs of the people who participate in them. In order to assess the extent to which attitudes are similar between two groups, it is often necessary to conduct several surveys so that comparisons can be made. Surveys are a way of directly testing your research by asking the target audience. While they have many shortcomings, surveys are the cheapest and easiest way to get feedback on your work. The two main forms are structured and unstructured. Structured formats allow you to ask your respondent specific questions on a pre-determined topic. This can be used before conducting a larger poll, or even after to see if your results were accurate in the first instance (Michaelidou et al., 2011). Unstructured formats allow respondents to respond using their own words and topics as they wish; asking them questions in an open-ended manner allows you to draw important conclusions that can be extrapolated to other sectors or countries with similar conditions.

9.11. CASE STUDY/CASUISTRY A casuistry is a powerful way to test research findings, as it allows us to examine different applications of the same procedures and see how those applications may differ. By using casuistry, we can determine whether the procedure described in a research article will actually produce the expected results or not. It is a mode of argumentation and reasoning that involves

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a consideration of the ethical or moral consequences of an action, as in weighing competing arguments for or against a course of action. Casuistry serves as a means for ethical evaluation and often forms the basis for issuing judgments. The question of the “objectivity” of casuistry as a test of scientific research has been a controversial issue in psychology. Although many psychologists agree that the evaluation of subjective reports should be based on an analysis that takes into account the social, psychological and cognitive context of testimony, others argue that this kind of contextualization is impossible because all cognitions are intentional or because there are no universal principles in fact making it impossible to establish a clear line between what is intentional and what is not (Möller & Parvinen, 2015). In addition to these philosophical arguments against the possibility of using casuistry as a test for scientific research, several empirical studies have shown that in many cases casuistical decision-making is not equivalent to commonsense reasoning.

9.12. QUALITATIVE ANALYSIS Qualitative analysis is a way of testing research. With qualitative analysis, you explore the meaning or perception of a subject by analyzing the information in quotes and reports. Qualitative analysis can be used to test hypotheses and theories, as well as explore research questions and purposes. Qualitative analysis is a way of testing research by dividing the sample population into smaller subgroups and analyzing the responses to determine if the sample population is consistent with that analysis. Qualitative analysis is used more often than quantitative analysis. It simply means that you look at samples of data rather than compare a pregiven data set. The most common type of qualitative research is observation, which is used to examine phenomena in nature as well as human behaviors. Other uses of qualitative analysis include interviewing and case study (Möller & Halinen, 2018). Unlike quantitative research, in which the numbers represent measurements of specific things, qualitative research focuses on understanding how people think and feel as well as what they say and do. The process of qualitative research often involves asking open-ended questions to ensure that you get a more accurate picture of your results.

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9.13. CUSTOMER FEEDBACK Customer feedback as a tool for market control. Feedback is the ability to recognize and correct problems that arise in a product or service. This can be done through customer surveys, and general feedback they provide to personnel regarding their emotions and attitudes towards a product or service. Using customer feedback to increase demand, improve products and services and drive a better return on investment was once taboo but is now a common practice. Feedback refers to the customer’s personal opinion of a product or service. Using feedback as a market control technique can help you understand what your customers like and dislike about your product, and how they use it.

Figure 9.13: A cycle of the customer feedback strategy Source: Image by HubSpot

The customer feedback is a great way to control the market. The customers have very strong impact on their loyalty and strength of their relationships with the business. If a customer has positive experience, it will enhance trust and help increase sales. As a marketing technique, customer feedback can help boost your business’s reputation. It also offers you the opportunity to improve the service and products that you offer (Mudambi, 2002). Feedback can be emailed, posted on social media or asked in person. It’s up to you how you want your customers to receive feedback – but if you ask for it will show up in their inbox!

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The types of customer feedback are discussed below.

9.13.1. Product Feedback Product feedback is a type of customer feedback that allows customers to provide feedback on products and services, providing the business with important information about their customers. The main purpose of offering product feedback is to collect subjective data regarding a product’s quality, usage and other relevant information. Feedback provides an opportunity for product improvement. Feedback has the power to change a product, from the purchaser’s point of view. Customer feedback affects the decisions consumers make in buying products.

9.13.2. Customer Service Feedback Customer service can be seen as a type of customer feedback. The customer service is really about providing help and assistance to customers who are encountering problems. This can be done through several different channels, including phone calls, email exchanges, phone wait times and departmental customer service representatives. Customer feedback is gaining ground as a type of customer service and helpdesk support (Chang et al., 2012). Customer feedbacks can be categorized as: negative, positive or neutral feedbacks. Negative feedbacks can lead to bad standing in the eyes of customers. Positive or neutral feedbacks could serve as motivation for companies to perform better in the future by offering better services or products to customers. A company that has earned positive feedback from its customers is generally better equipped to withstand negative feedback in the future. It can also provide a positive tone for all of its other interactions with customers, whether it be product support or service calls. What seems like a single point of contact for a phone call or an email is actually a series of interactions, so this resonates with people who are familiar with interactions on any level and an attempt to create more direct communication between companies and their customers.

9.13.3. Customer Satisfaction Feedback Customer satisfaction feedback is a type of customer feedback that provides information about how customers feel about the product or service they have received. Customer satisfaction surveys are used to obtain customer

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feedback, with the purpose of improving a company’s products or services. Feedback is collected via phone, email, in-person visits and other methods. Data can be collected using pre-generated surveys or manually entered data by the surveyors (Mejri et al., 2018).. Satisfied customers are more likely to recommend your product, use the product again and tell their friends about it. They’re also willing to pay more for their next purchase of the same product. The idea behind this method is to help organizations identify problems that might not arise easily through other means and respond accordingly.

9.14. COMPLAINTS Complaints are a type of customer feedback. They are useful for monitoring the quality of products, services and processes. Complaints are important for organizations to understand how to respond to their customers. Complaints are an important source of information to help a business identify and address any weaknesses in its products or services. This can be a useful way to gather market intelligence, since the customer feedback may include details of the purpose of the complaint and who is involved. By providing good customer service, companies can greatly increase their customer loyalty which leads to an increase in sales. Disadvantageous feedback is a word used to describe bad customer service – it may give an indication that your business is not interested in doing business with you anymore and might cause problems in the future (Leek & Christodoulides, 2011).

9.14.1. Cost Analysis Cost analysis is a market control technique used by a company in order to keep the price of their product at an acceptable level. This can be done through different methods, some of which include: benchmarking, economic analysis, cost drivers, cost/benefit analysis, and average cost per unit. The goal of most cost-control research is to identify factors that influence the production process, based on which managers can plan their way around specific problems in the production process.

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Figure 9.14: Marketing cost involves both variable and fixed costs Source: Image by MBA Skool

Cost analysis consists of two types of decisions that companies make: first, by how much they plan to pay for each unit manufactured or sold; and second, what price they expect to charge. These decisions are made in order to identify the optimum price range in which their product will sell at highest volume. For example, if the financial cost of producing a product is $1 to $2 per unit and demand is relatively stable at around 100 units per month, then it may be that the company would be better off charging a price between $6 and $8 (Lim, 2018). Cost analysis helps companies reduce costs, increase competitiveness and profitability, respond to changes in marketplace conditions, and achieve long-term goals. It further allows a company to measure the cost of each product they offer and compare those costs to other companies who are offering similar services in order to determine which service has the lowest price. In order to be successful at this process, all costs need to be properly accounted for. Certain costs can fluctuate with time, like employee wages or construction prices; however, there are other fixed costs that do not change over time. This is where budgeting plays such a big role in cost analysis.

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9.15. TYPES OF MARKETING CONTROL Marketing control is a broad term describing the organizational level of a company, which attempts to control its profit margins by controlling product pricing, distribution and its marketing activities. There are two types of marketing control; operational control is where one has complete control over the actual supply and demand situation, while financial or strategic control focuses on influencing the decisions made by managers within the firm itself (Lambert & Enz, 2012).

9.15.1. The Annual Plan Control The Annual Plan Control is the most common type of marketing control. It’s a calendar-based approach that has been used for years to determine budgets, sales targets and other financial objectives throughout the year. This process is responsible for setting out the objectives of your brand year by year and monitoring whether you are meeting those goals. Through managing the budget, you can set how much you need to invest in each area of your business at any given time. Every year, when your annual plan is completed, it will identify any areas where money needs to be allocated in order to make progress toward its targets or objectives.

Figure 9.15: Diagrammatic representation of the annual plan control Source: Image by the investors book

The annual plan control is a tool used to determine strategy and tactics ahead of time, rather than on a monthly or weekly basis. It can be used to collect and analyze data that is used to make strategic decisions about your products, pricing and marketing campaigns, such as how much money to allocate for advertising or how many new employees to hire. The annual

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plan control is a little more specific than the general plan control. It focuses on the progress of the business and includes an objective measure to gauge performance against your objectives (LaPlaca, 2013). The annual plan control ensures that the marketing and promotional activities are in line with the approved budget. This plan includes all activity related to: annual budgetary expenditures, sales promotion objectives and methods, travel plans and support budget.

9.16. MANAGEMENT BY OBJECTIVES; THE HEART OF ANNUAL PLAN CONTROL Management by objectives (abbr. MBO) is a management approach in which the focus of the organization will be on implementing measures and policies that meet certain goals or objectives. The objective is to get maximum benefit from each specific action project. Now, plan control is a form of management by objectives. It is an organizational tool used to monitor and control aspects of an organization’s business in order to set goals and objectives, assign responsibility and manage against them. It is a management system that uses the annual plan to determine how to achieve specific business performance goals through an ongoing process of planning, organizing and controlling human, material and financial resources. Decisions about the use of resources are made through activities that use control as a type of market control. These activities are divided into three phases: planning, doing and evaluating. The plan controls that exist for every activity vary depending on the time frame for the activity. One example would be a calendar cycle; another example might be a crew rotation (Cortez & Johnston, 2017). Management by objectives uses shortterm (time to market) as a priority, whereas stockholders are required to be satisfied with only minimum returns from their investments. The focus of management by objectives is on the achievement of goals over the long term, which might differ from those of shareholders who would like to see higher dividends or share prices than those currently achieved. The fixed operating targets are an answer to the need for all employees to be able to see, understand and accept that the objectives are set and not in dispute. They help reduce uncertainty and encourage employees to apply themselves enthusiastically toward the attainment of these targets. Objectives are the targets that a management team sets and acts upon. Objectives along with the annual plan control process help managers to set realistic goals and make adjustments in order to accomplish those goals.

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9.16.1. Profitability Control Profitability control is the effort to manage and increase profit through demand and price. Positive profit margins can be achieved in a number of ways: by reducing costs, increasing prices or both. In order to control a market, an organization must have some degree of ability to influence the price of the product being marketed (LaPlaca & Katrichis, 2009). This means that ‘profitability control’ is one of the ways in which an organization can exert market power. Profitability control is also known as marketing power. When a market has no dominant player, the strongest factor in determining that market’s outcome will be a single firm’s profitability. The process of marketing-profitability analysis is a method for assessing the profitability of a business. It is accomplished by gathering data about sales, expenses, and other factors to determine whether the company’s products or services are profitable. A company’s overall financial performance can be affected by the choice of products in its line. For example, if the product line includes products that have higher profit margins than other products in the line, then it may be possible to increase profitability by selling more expensive products or fewer low-margin products.

Figure 9.16: Steps in profitability control Source: Image by the investor’s book

The analysis should be conducted at regular intervals to ensure that the business remains profitable. The analysis should also be performed after making changes to products or services so as to identify any potential problems. This type of analysis involves many steps:

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• •

Determine what product or service will be produced and sold. Determine how much money will be spent on each step in the production process (including materials). • Calculate all costs associated with producing this product or service, including labor costs and overhead expenses like rent and utilities. • Calculate profits earned per unit sold and per dollar spent on advertising that generates sales for the company (or vice versa). Profitability analysis measures whether or not a company is earning enough money from its products and services to cover expenses. This includes everything from direct costs like salary costs and rent, to indirect costs like insurance premiums and advertising costs (Chang et al., 2018). The first challenge facing profitability control is that the company is not profitable. This can be caused by many different factors, but often times it can be traced back to a lack of proper training and/or policies in place that are helping to ensure that employees are working hard and efficiently. A second challenge facing profitability control is that it is difficult to know when you need to implement new controls. For instance, if an employee is complaining about how long it takes them to produce a certain product, this will likely indicate that there is something wrong with their current system for making the product (Lages et al., 2008). However, without knowing exactly what is causing this issue, there isn’t much that can be done about it until more information becomes available about how long things are taking (if at all). The final challenge facing profitability control is that it’s hard sometimes to determine whether or not your company should even be focusing on profitability at all. For example, if your company has been running for a long time without having any problems with overspending or under-delivering on products or services provided then perhaps it would make sense.

9.16.2. Efficiency Control Efficiency control is a type of marketing control that aims to increase the efficiency of a company’s marketing efforts. It is a relatively new concept, but it has already been used by some companies, which have increased their sales by using efficiency controls. Efficiency control is different from other forms of marketing control because it focuses on improving the efficiency of the company’s customers rather than the company itself.

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Figure 9.17: Efficiency control mechanisms Source: Image by the investors’ book

It focuses on the efficiency of a marketing campaign. The goal is to maximize the number of leads generated by the campaign, while maintaining a positive ROI. This kind of control is often used in B2B marketing, where there are typically high costs associated with lead generation and little room for error. Efficiency control also works well in B2C environments, where there can be more flexibility in terms of budget and strategy. This type of marketing control implies that we make sure our marketing efforts are directed at the right people and at the right time (Lim et al., 2019). For example, if we are trying to sell products at [location], we will only use social media posts on Facebook and Twitter that are relevant to people who live there. If we have a limited budget for advertising, this will allow us to spend more time looking for solutions rather than just throwing money at the problem.

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There are three types of efficiency control: •

•

Productivity control: This type of control is about identifying and measuring the amount of time it takes to complete an activity, such as how long a truck driver spends on the road delivering products from one place to another. Capacity utilization rate control: This type of control is about the amount of equipment being used, such as how many workers are on a production line at any given time.

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•

Flow rate control: This type of control measures the rate at which materials or products move through a system, such as how many containers are filled with product per minute by workers in a manufacturing facility or warehouse. Efficiency can be used in a variety of different ways. For example, it’s important for companies to ensure that their marketing campaigns are as efficient as possible in order to reach their target customers as effectively as possible. This means that the campaign has a goal, identifies what the campaign is meant to achieve, and then executes it well. It also means that the campaign is cost-effective so that it doesn’t waste money on things that aren’t necessary or don’t help accomplish its goals. Efficiency can also be used in terms of how long it takes for a company’s product or service to reach customers (and thus how long they have access to it). In this case, efficiency refers both to how long something takes—in terms of days or weeks—and also how much money or resources are spent on making things happen quickly versus slowly over time (Lichtenthal & Eliaz, 2003). For example, if there’s only one person available who can do something quickly but not at all efficiently because she has other tasks that need her attention right now, then perhaps this task should be delayed until more people are available who could take care of it efficiently themselves instead from beginning.

9.16.3. Strategic Control Strategic control as a type of marketing control refers to the way in which a company’s marketing strategies are used to help it achieve its ultimate goal of producing and selling a product or service. Companies will often use strategic controls as one of their primary tools in order to achieve this goal. Strategic control is the most widely used type of marketing control. It involves the design, implementation and evaluation of a marketing program that attempts to achieve a specific business objective. The term strategic control has been used in relation to marketing since the early 1950s and was first introduced by William A. Lazonick in his book on competitive strategy. One example of a strategic control is the use of advertising. Advertising is used by companies in order to create awareness for their products or services, which can then lead to sales. In addition, advertising is also used as a tool to make sure that consumers know about upcoming products or services. Another example would be the use of promotions (Krings et al., 2021). Promotions are also used by companies in order to increase sales and

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awareness; however, they are more focused on giving away free samples or coupons than they are on creating brand loyalty among consumers who may not have otherwise purchased the product or service being promoted at all. A third example would be pricing strategy; companies will often change their prices based on consumer demand (e.g., if there’s high demand for one product but low demand for another). This helps them keep pace with changing consumer demands so that they can continue providing their customers with high-quality goods at competitive prices while still making enough profit (Kim & Moon, 2021). Strategic control works by using research, planning, and forecasting methods that help you make decisions about what products or services your company ought to offer. These can include things like:

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• What technology will be available in the future? • How will customers want to buy these things? • What are some new ways people might want to buy these things? • How will competitors sell these things? Advantages of strategic control include: • •

•

It is a form of marketing control that does not require the company to change their products or their services. The company can continue to use their current strategy, but with a new set of rule that allows them to more effectively manage the business (Crick & Crick, 2020). Strategic control is more likely to be successful if the company has a strong desire to keep their products and services consistent and on track.

10

CHAPTER

MULTIDIMENSIONAL SCALING

CONTENTS

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10.1. What Precisely is Multidimensional Scaling?................................. 240 10.2. MDS Incorporation ....................................................................... 240 10.3. Genus and Subtypes ..................................................................... 243 10.4. Multidimensional Scaling vs. Factor Analysis ................................ 244 10.5. Trends in MDS .............................................................................. 246 10.6. Multidimensional Scaling in Business ........................................... 251 10.7. Application of Multidimensional Scaling in Market Research ........ 253 10.8. Facts and Figures about Multiple Sclerosis .................................... 254 10.9. The Performance of Multidimensional Scaling............................... 254 10.10. Choosing the Number of Dimensions to Include......................... 256 10.11. Assessing MDS’s Dependability and Correctness ......................... 256 10.12. The Purpose of Multidimensional Scaling.................................... 257 10.13. Multidimensional Scaling Applications ....................................... 258 10.14. Characteristics of Multidimensional Scaling ................................ 260

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10.1. WHAT PRECISELY IS MULTIDIMENSIONAL SCALING? A visual representation of distances or discrepancies between groups of things is multidimensional scaling. Colors, faces, places on a map, and political ideology are all examples of things. Elements with shorter distances between them are clustered closer together in the graph than those with greater distances (or longer distances). MDS, in addition to graph distances, may be used to describe differences in high-dimensional data (Kumar et al., 2020). The technique of “scaling” in psychometrics refers to the attribution of numerical values to abstract ideas (or “objects”) in line with specified norms. For example, you could be curious about someone’s thoughts on global warming. On a scale of 1 to 10, “firmly believes in global warming” equates to a “1” for those who don’t and “doesn’t care” for those who do. Consider “scaling” as a means of minimizing the amount of data (i.e. making it simpler by creating lower-dimensional data). A reduction in the number of dimensions does not affect the quality of the data. If two data points are close together in high-dimensional space, they will also be close together in low-dimensional space (Davies et al., 2010). The term “multidimensional” alludes to the notion that you are not restricted to two-dimensional graphs or data. Plots with third, fourth, or even higher dimensions can be easily constructed. MDS is presently used in a broad variety of sectors. Its use is not limited because it may be applied to any matrix that has some type of relational information. Correlations, distances, different rating scales, and similarities are all examples of relational data.

10.2. MDS INCORPORATION Imagine you were given a list of city sites and instructed to build a map displaying the distances between them. All you’d need for the method is a ruler and a few simple arithmetic calculations. Would it be preferable if you were simply given the distances between cities rather than their locations? You’d have to utilize some geometry and reasoning to get past this. This sort of logic issue is suitable for multidimensional scaling. Your final aim is to create a map that includes the original distances and locations of the inconsistencies that you have been provided.

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10.2.1. The Essentials A variety of sites can be allocated n-dimensional coordinates. In n-dimensional space, it might be two, three, or even more dimensions (at least, theoretically, because 4-dimensional spaces and above are difficult to model). The researcher normally chooses the orientation of the coordinate axes at random. Axes that depict north/south and east/west are the most reasonable options for basic maps like the one seen above (Kleinaltenkamp & Jacob, 2002). Any two points’ Euclidean distance may be computed in the same way. The Euclidean distance is the distance between two points x and y in Euclidean space that is separated by a “straight-line” distance. Calculating c2 in n-dimensional space using the Pythagorean theorem becomes substantially more difficult. For further information, see “Euclidean Distance in n-dimensional Space.” As a consequence, the similarity matrix was created. To compare the similarity matrix to the original input matrix, utilize the stress function. Stress is a goodness-of-fit metric calculated by comparing projected and actual distances. It is claimed in his initial 1964 MDS research that “poor” fit scores were anything over (Johnson et al., 2012). A method for evaluating stress has been presented based on the number of objects and the quality of the distance matrix.

Figure 10.1: Multidimensional scaling Source: https://www.istockphoto.com/es/vector/iconos-relacionados-conel-conjunto-de-desarrollo-profesional-avances-parte-7-gm497213602– 78994427?phrase=Multidimensional%20scaling

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Make any necessary changes to the coordinates to alleviate stress.

10.2.2. Errors Could Occur A two-dimensional graph, such as one illustrating the distance between cities, is the easiest to comprehend. A 2D graph may be twisted and incorrectly depict similarities or distances, but a 3D graph is more exact and accurate. If this occurs, you can add more dimensions to the graph (i.e. to a 3D graph). Due to their intricacy, 3D and higher graphs are challenging to depict on a flat computer screen or sheet of paper. Furthermore, even the most expert mathematician struggles to understand them (Janita & Miranda, 2013). Because the purpose of multidimensional scaling is to simplify a complicated matrix, anything beyond a three-dimensional graph is rarely appropriate. MDS may measure both similarity and dissimilarity, however, it is most typically used to estimate the degree of separation between two entities. Two unit antennas, Symmetrical Ring Structure (SRS) and standard Ring Structure (RS) express dissimilarity and similarity concerning two points, respectively. When values are near together, the RS are small, and when they are far away, the RS are enormous (i.e. are more dissimilar). Smaller SRS values suggest higher dissimilarity, whilst bigger values indicate greater similarity (i.e. values are closer together). A monotonic decreasing transformation is a rapid and easy way to transition between similarity measures. The following transformational formula is provided by NCSS (n.d.):

Figure 10.2: An infographic on certain aspects of multidimensional scaling Source: https://www.istockphoto.com/vector/vector-set-of-16-icons-related-to-business-intelligence-analytical-processing-and-gm654537436– 119079263?phrase=multidimensional

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10.3. GENUS AND SUBTYPES When they published Multidimensional Psychophysics, they used metric multiple dimension scaling for the first time. Others, had utilized the notion, albeit they did not name it multidimensional scaling It was expanded and improved the approach to metric MDS. MDS may be divided into two sub-types based on variations in how dissimilarities (r) are transformed into the distance (Drs): •

Multidimensional metric scalability for quantitative similarity measurements. The function f serves as the basis for the MDS model (). It was claimed that most metric MDS algorithms meet the following formula: Drs = f(; rs) There is a wide range of conceivable functions, but they all follow the same linear pattern. In other words, the value of d is increased by double.

Figure 10.3: Vectors used in MDS Source: https://www.istockphoto.com/vector/virtual-city-graphic-the-designof-the-virtual-space-gm938401566–256614320?phrase=multidimensional

Nonmetric multidimensional scaling (or ordinal MDS) is based on qualitative similarities rather than metric measurements. On an ordinal scale, ordinal MDS distances are compared to each other. There is no other source of accurate information in nonmetric MDS except the ranks; distances are arranged in X as strictly as the proximities (Iglesias et al., 2020). There are two types of nonmetric MDS: the metric MDS and the metric MDS with linear relationships. No matter how complicated or how simple the curve is,

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it will always have a rising (or falling) tendency from left to right. F is not explicitly defined in metric MDS. Is it as simple as it appears to choose between the two (metric vs. nonmetric)? For example, “…the many varieties of metric scaling vary as much among themselves as they do among nonmetric scaling.” It’s also possible to mix metric and nonmetric scaling in a single model. The most straightforward response is that your selections are restricted by the computer software that you’re working with.

10.4. MULTIDIMENSIONAL SCALING VS. FACTOR ANALYSIS Detecting patterns or correlations in data may be accomplished through the use of multidimensional scaling (MDS) as well as factor analysis (FA). A matrix of association measurements is required for both methods. FA, on the other hand, requires metric data, while MDS can handle both metric and non-metric data.

Figure 10.4: Graph charts on factor analysis Source: https://www.istockphoto.com/es/vector/gr%C3%A1fico-de-negociosgm162399328–23255916?phrase=Factor%20analysis

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Figure 10.5: Factor analysis increases income Source: https://www.istockphoto.com/es/foto/concepto-de-aumento-de-ingresos-gm184030321–27645271?phrase=Factor%20analysis

You can visually verify your findings with MDS if you can construct a 2D map. Interpretation and Validation of MDS Output It is the analyst’s primary objective that the best fit can be achieved with the fewest dimensions. One caveat to bear in mind while doing MDS is that, while compressing the input data into a two-dimensional space increases “readability,” which may result in an extremely poor and highly distorted representation of the data. Scree charts, which plot stress function value versus dimension number, can be used to determine if additional dimensions are needed to suit the data better. Ideally, the scree plot should show that rising dimensions (to the right of the elbow) do not influence stress (Iankova et al., 2019). There is no substantial reduction in stress after three dimensions, as illustrated in Figure 2 (scree plot of theoretical data). A three-dimensional representation of the data is therefore quite likely to be useful. Scree plots are limited in their ability to determine the most appropriate number of dimensions since stress often reduces gradually with increasing dimensionality, making the occurrence of a noticeable elbow unusual. The original data may need to be re-examined because of measurement inaccuracies, which might lead to high levels of stress.

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Indirectly, these 5 interpretations can be validated by the analyst’s assessment of the generated dimensions. Regression analysis may be used to examine the relationships between MDS-derived dimensions and other variables. Additionally, a split sample or multisample comparison may be used to check the stability of the MDS solution, in which the original sample is divided or a new sample is gathered, as appropriate (Di Benedetto & Lindgreen, 2018. Generally, split-sample verification is used since it is both faster and cheaper. An MDS solution’s consistency across similar samples, or lack thereof, may be determined using this technique.

10.5. TRENDS IN MDS Use in Psychology. I.e. used the search engines PsycINFO and PubMed to identify some of the current trends in the usage of MDS in psychology. Medical, genetic, neurological, and other theoretical elements of MDS are not included in our review since they fall beyond our purview. To be sure, this method does not provide a thorough overview of MDS’s use within psychotherapy but it does enable the identification of significant tendencies. The consideration of representative research will help to clarify these patterns. Using MDS in the Design and Validation of Tests MDS has been used to assist in the development of tests, assess the validity of such tests, and simulate the behavior of those tests (Hunt, 2013). This process, item analysis, is a key step in the formulation of tests in psychology or any other subject. Because items were chosen based on their correlation with the summary score, they claimed that item analysis has typically been unidimensional. Nonmetric MDS was introduced to prevent a preconception of certain variables or notions. According to researchers, less strict assumptions regarding the distributional and metric features of data are made by MDS than those made by other methods. Analysis of item clusters in MDS maps and hierarchical cluster analysis demonstrated that the questionnaire items were loaded on the most important criteria. They concluded that item analysis can be improved by employing MDS. Modeling tests or item answers is possible using MDS, which is a kind of factor analysis. Both MDS and factor analysis, provides a continuous coordinate space from which structures termed factors are recovered. In the context of MDS, correlations, and covariances generated by factor analysis might be considered proximity indices. For example, they found that MDS gives a spatial representation of variability between tasks, while traditional factor analysis provides a geographic representation of

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variability between persons. If scores vary along latent components, observed responses are linear functions of a person’s scores on those constructs, and the sensitivity of tests to these constructs varies, then factor analysis accepts this as the norm. When it comes to MDS, on the other hand, the assumption is that most tests/tasks differ on numerous dimensions and that individuals vary along each dimension following their optimum point (the most preferred combination of perceived variables). A scree plot example may be seen in the second figure. The observed reaction of a person to a certain activity is connected to the discrepancy between the task’s qualities and the ideal point of the subject. This means that factor analysis results can be used inside MDS to simulate test or item responses. Personality profiles using MDS are created by reshaping the results of personality assessment instruments and deriving latent variables (Hinterhuber & Liozu, 2015). Dimensions in MDS are regarded as profiles, and they are represented as dimensions in MDS. While allowing for the portrayal of typical (normative) population profiles, MDS also allows for the demonstration of individual differences regarding these profiles. An individual’s profile match index is calculated by taking into account the individual’s profile variability along and across profiles. How effectively a person’s normative profile represents them is measured by this indicator. Rather than relying on theories to provide normative profiles, this method of profile analysis is best suited to circumstances in which the facts themselves provide the normative profiles. MDS was compared to cluster analysis and modal profile analysis as a method of profile analysis. Analysis of items is done by grouping them into relevant categories or clusters. The profile traits of a cluster are described by the mean of each subtest score across all cluster individuals. Clusters with different profile forms may be generated using standardized scores from a modal profile analysis. Construct normative profiles, it identifies the most prevalent patterns in the data. In contrast to MDS, cluster analysis has a drawback in that the clusters capture individual variations in total profile level rather than differences in profile patterns. Modal profile analysis, in contrast to MDS, does not give insight into the profile levels (the average of all subtest scores). Cluster and modal profile studies’ inability to be applied to big samples is yet another drawback. Aside from generating patterns, MDS profile analysis can offer information on the profile level and quickly evaluate samples of

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any size. In Counselling Psychology, MDS is a useful tool. There are many different ways to gather information in the field of counseling psychology and they all have varying degrees of organization. As a result, this material lacks recognizable factors because it is created from a dynamic meeting between the counselor and the client Data in this sector can’t just sit on the surface and be understood in its entirety (Dlačić, 2015). As a result, data in counseling psychology may be analyzed using approaches like MDS. Matrices may be used to examine the differences between individuals. These matrices can be obtained from recognized organizations or individuals. If each subject’s data is viewed as a different proximity matrix, multiple measures can be derived. Another method is to group individuals based on some distinguishing feature, whether demographic or psychological and generate proximity measurements for each group. Furthermore, distinct proximity metrics for data collected at different times or under different conditions may be developed. Thus, MDS can be used to present a representation of individual or group differences in addition to illustrating interrelationships between items and discovering underlying data dimensions. The practical significance of a flexible technique in constructing multiple types of proximity matrices from the same data is that it allows for better data use and provides more information. Individual differences psychology, which focuses on describing differences in psychological attributes between people as well as the reasons and implications of such differences, has had a significant impact on counseling psychology (Gregory et al., 2019). Individual difference variables that are most important in counseling psychology can be organized under any integrative framework to allow the integration of the two sciences. Researchers work met this need by creating the Atlas of Individual Differences. The Atlas’s goal is to map the relationships between measures of individual differences to facilitate career counseling (i.e. matching individuals with the most feasible professional route) (i.e., matching individuals with the best possible career path). People want jobs where they can work with people who are similar to them. It categorizes people into six personality types: realistic, investigative, artistic, gregarious, entrepreneurial, and conventional, which form a two-dimensional hexagonal structure when shown physically. Each fitted 7 property vector describes the average relationship between a particular cluster of external factors and Holland’s model. The canonical correlation between the model’s coordinates and the conditional probability scores of the variables in the cluster is used to determine the strength of a connection.

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A movement of the observed object towards the vector’s arrowhead indicates an increased tendency. According to Armstrong and colleagues, the results of their experiment indicate that MDS can be used to develop a complete model that includes human traits as well as environmental demands. Individual differences discovered in their study appear to be the result of a sophisticated developmental process in which people discover ways to operate in their environment. Statistical techniques, such as MDS, that provide a relatively clear description of such nuanced connections may increase the potential value of incorporating individual differences data in practical settings such as counseling psychology (Griffin, 2002). MDS and perception MDS is frequently used in perception research. As a result, we will limit our discussion to a few fascinating cases that highlight the importance of MDS in this industry. In terms of olfactory perception, researchers conducted a study that asked participants to describe odors, even those that were ambiguous (often labeled “boundary”). One group of participants was free to sort fragrances, while the other was limited to categorizing the odors into two groups. Unambiguous fragrances, it was thought, would reveal more about the underlying aspects of olfactory perception than ambiguous ones. This method’s data resulted in a two-dimensional spatial map. Its coordinates were submitted to cluster analysis to validate the MDS results. A third experimental group performed the odor sorting task using objective criteria (e.g. intensity) for additional validation (Yang & Gabrielsson, 2017). Their ratings were combined, and the mean rating scale values for each odorant were regressed against their MDS map positions. This regression result was then used to generate direction cosines for vectors corresponding to the best fitting projection of the rating scales into the MDS model. This approach confirmed MDS pattern trends. The free sorting test results revealed a circumflex pattern in olfactory perception, with confusing odors in the center and distinct ones on the periphery. The odors were divided into two categories by restricted sorting, with ambiguous fragrances represented within each. As a result, the development of a more detailed model is dependent on the flexibility of the sorting criteria provided to participants, emphasizing the importance of careful consideration when selecting a data collection technique. Researchers also used MDS to create haptic (tactile) perceptual space. Their research focuses on the tactile perception of materials encountered in everyday life. MDS analysis revealed a four-dimensional tactile perception space after free sorting the haptic stimuli. This was supported by objective assessments of the

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test materials’ compressibility and roughness. Using property vector fitting, the objective measures were integrated as external variables into the MDS model. This experiment produced unsatisfactory results, demonstrating that objective physical properties of materials cannot fully explain tactile space dimensionality. As a result, a more complex model inside a curved non-Euclidean space may be required for better tactile space representation, emphasizing the limitation of Euclidian principle-based MDS. Deviations from Euclidian principles, on the other hand, may impede interpretation and intuitive knowledge of the model. MDS and Emotional and Pain Perceptions Because emotional experience is a highly subjective and qualitative phenomenon, it lends itself to investigations using nonlinear statistical techniques such as MDS. Researchers also conducted an experiment in which they attempted to build a spatial representation of emotion. They showed people schematic faces with purposefully altered lip and brow angles that indicated various moods (Wang et al., 2008). Participants were asked to use the semantic differentials method to assess the difference between the faces without identifying the emotion. Matrixes of subjective differences for the faces were created using this data. Following that, all subjective matrices were subtracted from one another, and the resulting matrix of absolute values revealed the disparities across emotions for all people. These absolute values were displayed in a fictitious spherical sphere with the emotional tone, intensity, and saturation as dimensions. The experimenters then presented each emotional face with emotion labels to investigate the relationship between emotional space and its semantic label. This suggested that any change in the schematic emotional expression necessitated a shift in its corresponding location in the spatial representation emotion, pain is thus a complex experience comprised of various aspects such as somatosensory perception, tolerance, attitudes, and so on, all of which are similarly appropriate for examination using MDS. There is currently little agreement on the number and types of qualities that may describe pain perception (Wang et al., 2016). Various researchers researching in the field investigated the properties of thermal pain perception using the INDSCAL MDS model. Participants rated stimuli on an intensity scale ranging from minor discomfort to extreme unpleasant sensitivity (noxious). A twodimensional “pain structure” was suggested by MDS analysis. The first dimension is concerned with stimulus intensity, or how weak or strong a stimulus feels. The second dimension was linked to qualitative aspects of the stimuli, specifically, the pain temperature attribute, which

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ranged from barely detectable to agonizing, and from barely detectably warm to hot. The authors concluded that the bipolarity of the second dimension demonstrated data unpredictability. It was claimed that a third dimension was used by a few people with enormous weights. Subsequent research using MDS by the same group expanded on the two-dimensional model by introducing new dimensions. According to various researchers, the predominance of pain perception features promotes concept clarity, which should stimulate future research between pain experience and individual differences such as anxiety, personality traits, and mood.

10.6. MULTIDIMENSIONAL SCALING IN BUSINESS In marketing, MDS is commonly used to display participants’ preferences and impressions. These grids, which are typically two-dimensional, are known as perceptual maps, but they can represent more than two dimensions. The similarity of the two objects is examined to see whether there is a correlation. MDS extracts underlying dimensions from respondents’ ratings of product similarity, but other approaches (such as component analysis, discriminant analysis, and conjoint analysis) do not. In my perspective, it’s a significant thing. It is not based on the findings of researchers. It is not necessary to provide responders with a list of qualities (Voola et al., 2022). The underlying factors are based on respondents’ perceptions of product pairings. Because of these benefits, MDS is the most often used method for perceptual mapping.

Figure 10.6: Scaling leads to increasing profits Source: https://www.istockphoto.com/es/foto/empresaria-medidas-crecimiento-con-cinta-m%C3%A9trica-gm500878672–81039577?phrase=scaling%20 in%20business

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Figure 10.7: Perceptual mapping Source: https://www.istockphoto.com/es/foto/internet-de-las-cosas-conceptoiot-gm940565650–257115726?phrase=perceptual%20mapping

10.6.1. Scaling in Several Dimensions Several phases must be completed to perform an MDS study: Identifying the problem – Which brands should be compared? How many distinct brands, in your opinion, should be evaluated? More than twenty is excessive. At least eight people are required for reliable findings (four pairs). To what purpose will the study be put? To collect input data, respondents are given a series of questions. Respondents are asked to assess how similar each product combination is (usually on a 7-point Likert scale from very similar to very dissimilar). Coke/ Pepsi is a nice place to start, then Pepsi/Dr. Pepper, Coke/Hires rootbeer, and so on. Q represents the total number of questions, and N is the total number of brands. This is referred to as the “direct approach to perceptual data.” There are two other strategies to examine (Veloutsou & Taylor, 2012). Using the “perception data: derived method,” products are divided into semantically distinct qualities. In contrast, the choice data technique asks respondents what they enjoy rather than what they are like.

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The great majority of complex statistical software products have facilities for actually carrying out the MDS method. Nonmetric MDS and Metric MDS are frequently used as substitutes for one another (which deals with ordinal data). They must determine how many dimensions the machine can create. Increasing the number of dimensions increases statistical fit but complicates data interpretation. Defining the parameters and mapping the results. We may plot the findings using a statistical tool (or a module with a similar function). Every product will be displayed on the map (usually in two-dimensional space). When two items are near together, it may be seen as a symbol of their resemblance or popularity. The investigator must label all of the dimensions (Theron et al., 2008). This involves the use of one’s judgment, which can be difficult at times. The findings need additional investigation (see perceptual mapping).

10.7. APPLICATION OF MULTIDIMENSIONAL SCALING IN MARKET RESEARCH Multidimensional scaling (MDS) is a visual representation of respondents’ perceptions and preferences. A multidimensional space is used to depict the geometric relationships between points to portray how individuals perceive psychological interactions. Geometric representations of the physical world are commonly used to describe spatial maps. Determine how many and what kind of factors buyers use to compare brands. • To place brands about these metrics. • Determine the location of the ideal brand for the customer. Marketing applications: Brand image evaluation. Market classification. New product development – the map’s holes reflect rivals’ undiscovered markets. A product or service designed to meet that demand may be produced for commercial purposes. Certain marketing strategies try to reposition a brand to shift it from one market area to another (possibly more profitable or related to a company’s competitive advantage) (Tuten & Urban, 2001).

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• • •

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A multidimensional brand map may be used to determine whether or not constructing a new retail location near other brands is consistent with the company’s marketing strategy.

10.8. FACTS AND FIGURES ABOUT MULTIPLE SCLEROSIS

Figure 10.8: A paper reading multiple sclerosis Source: https://www.istockphoto.com/es/foto/esclerosis-m%C3%BAltiplegm1035049632–277119237?phrase=multiple%20sclerosis

To compare two brands, utilize the Likert Scale. Companies are ranked from most desired to least desired depending on how much people like or despise them. •

The Stress Test assesses fitness; the higher your stress level, the less fit you are. R-square, a squared correlation statistic, depicts the location of variance. •

Brand association perceptions are depicted on a map (presented as geometric relationships).

10.9. THE PERFORMANCE OF MULTIDIMENSIONAL SCALING The first step in initiating multidimensional scaling is formalizing the problem. This requires the researcher to describe how the MDS data will be used and to choose the brands or other stimuli to be investigated (a minimum of 8 brands should be considered to achieve a well-defined spacial map).

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What is the greatest method for gathering data for input? Respondents should be asked to compare and contrast different brands and stimuli using their own set of criteria (Likert Scale questionnaires are practical here) (Backhaus et al., 2011). In the derived approach, semantic differentials or Likert scales are used to ask respondents to score brands based on a set of previously established brand qualities.

Figure 10.9: An image showing a Likert scale Source: https://www.istockphoto.com/es/vector/una-encuesta-desatisfacci%C3%B3n-de-escala-de-5-puntos-muy-satisfecha-gm1168952582– 322950642?phrase=likert%20scale

Which is better: drinking with food or drinking alone?

Figure 10.10: Another example of the Likert scale Source: https://www.istockphoto.com/es/vector/escala-de-calificaci%C3%B3no-escala-de-dolor-escala-para-cuestionarios-clipart-gm1368461835– 438445226?phrase=likert%20scale

Researchers can also employ direct approaches without developing a list of differentiating characteristics as long as participants are free to pick their criteria (Baumgarth & Schmidt, 2010).This strategy makes it straightforward to find respondents who have similar viewpoints. These respondents can

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be classified according to their attribute ratings. The disadvantage of this method is that it requires much elaboration on the side of the researcher.

10.10. CHOOSING THE NUMBER OF DIMENSIONS TO INCLUDE MDS’s purpose is to create a spatial map with the fewest number of dimensions possible that closely matches the input data. The accuracy of geographic maps with additional dimensions is improving. In a stress test, the MDS is put through its paces. The greater the stress, the worse the fit. How to determine the number of dimensions of an object? • • •

Previous knowledge of the subject. Objects are tougher to understand in more than three dimensions. Working in two dimensions is far more convenient.

Understanding complexity and related dimensions Once created, the size and arrangement of a spatial map must be labeled and reviewed. Respondents may be asked to name the criteria they used to assess their choices. To show the strength of distinct flavors, “taste intensity” may be used as a label on the vertical axis (Theron et al., 2008). Because of the flavor that remains on the tongue after a meal, the horizontal axis might be referred to as “aftertaste.”

10.11. ASSESSING MDS’S DEPENDABILITY AND CORRECTNESS Every time, the supplied data is susceptible to some level of random fluctuation. This implies that analyzing the data’s accuracy is vital. An evaluation of the fit capacity index or the R-squared is essential. In addition, stress measurement can reflect the success of MDS treatments. The original data should be divided into two or more components if an aggregate analysis has been done. For each component, a separate MDS analysis should be run, with the results compared (Theron & Terblanche, 2010).

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10.12. THE PURPOSE OF MULTIDIMENSIONAL SCALING Multidimensional scaling is used to map the location of items to each other based on disparities in data. This method was the focus of pioneering research. Scaling refers to a one-dimensional reduction. When we are certain that there is just one underlying dimension of interest, we employ this method. Following this, computational tests are performed to ensure that the scaling solution is not influenced by more than one dimension. When data is collected, it may be used to determine which dimensions respondents utilize when rating things, the number of dimensions they may use in a given situation, the relative significance of each dimension, and the perceptual relationships between objects. MDS attempts to transform multi-dimensional spatial distances into consumer perceptions of similarity or preference (e.g. shop or brand preference). The perceptual maps depict the relative positions of all things. The core of multidimensional scaling is the comparison of things. There are two kinds of dimensions in the world: subjective and objective. Assume a company’s new lawnmower model has a 24-inch blade and is available in two colors (red or green). They are, for the most part, objective characteristics. Customers may or may not recognize these characteristics (Streukens et al., 2011). Based on the perceived measurements stated below, customers may believe the lawnmower is delicate or expensive-looking. Customers’ perceptions of objective dimensions may differ from the researcher’s assumptions in some circumstances. Aspect evaluations may not be independent and may not agree with one another. A fruity-smeling soft drink, for example, may be viewed as sweeter than a sugar-free version. The first step is to establish multidimensional scaling objectives. Perceptual mapping and multidimensional scaling are the best ways to fulfill both of these goals. Experimenting with unknown components that affect behavior. To get similar evaluations of objects when the precise foundation of comparison is uncertain or undefinable. Dimensions can be inferred through perceptual mapping without the requirement for particular attributes to be given. The dependent variable (object similarity) is presented in a simple example, and the independent variables (perceptual dimension) are calculated. Choosing the items to be scored, determining whether to analyze similarities or preferences, and deciding whether to analyze a group or individual level are all crucial considerations that the researcher must make while conducting a multidimensional scaling study.

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All Objects Are Eligible for Evaluation Perceptual mapping starts with a simple but important step: designating the things to be inspected. Researchers must ensure that the perceptual mapping process includes all “relevant” firms, products/services, or other items and excludes any “irrelevant” objects. Similarity vs. Preferences Perceptual mapping and MDS have already been investigated using similarity data. Respondents offer preference data using “good-bad” ratings, presuming that some combinations of perceived features are more highly valued than others. Although both comparison bases may be used to generate perceptual maps, their meanings differ. By examining similarity or preference data from respondents, we construct outputs that indicate the proximity of stimuli and treatments to each other in t-dimensional space (Shaltoni & West, 2010). This result may be generated subject-by-subject using a technique known as “disaggregate analysis.” However, employing multidimensional scaling techniques, an aggregate analysis approach can integrate data and yield fewer perceptual maps. The easiest method to learn about the overall assessments and dimensions used in those evaluations is to do an aggregate analysis. However, if understanding individual variations is the aim, a disaggregated approach is the most successful option.

10.13. MULTIDIMENSIONAL SCALING APPLICATIONS Since customers have comparable ideal positions and perceive brands similarly, market segments may be thought of as subspaces in which consumers have similar ideal positions and perceive brands similarly. To get a better knowledge of a product’s life cycle, researchers may be able to relate changes in many dimensions (characteristics) to a statistic such as market share. Pricing, delivery, dependability, technical support, and credit all factor into industrial purchasing agents’ judgments on which vendors to partner with. By researching how buying agents define a vendor’s features, suppliers may be able to improve their sales approach (Bendixen et al., 2004). To reach a given demographic, what periodicals should an advertising campaign target? Audience members and similarity of speed (e.g., vehicles) can be utilized to determine ideal points in a variety of possible mediums.

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This is comparable to the market segmentation method. Similarly, the optimal media for particular advertisements may be identified.

Figure 10.11: An infographic in scalability Source: https://www.istockphoto.com/es/vector/iconos-de-escala-serie-classicline-gm1356013809–430308736?phrase=scalability

As indicated in the preceding article, multidimensional scaling has several difficulties that must be regarded as major limits on its usage. The restrictions are classified into three types: There is a lack of conceptual clarity in the notions of “similarity” and “desire,” which can and may not be properly expressed. Smaller differences in one criterion may have a stronger influence than larger differences (Sharma et al., 2010). Interviews with respondents may alter the criteria used to assess similarities as well as the context in which respondents are thinking, such as a purchase for themselves or someone else. All of this remains unknown and unregulated. In the current investigation, it is assumed that each stimulus has only one choice (brand, in this example). If the preferred brand is unavailable, the summer is expected to choose another. What happens, though, if a buyer purchases several items, such as a second car? Would the order of preference for the second car alter after acquiring the first?

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What factors impact taste evolution? Do they change frequently, or are they more or less set in place? The answers to these questions determine how far a firm may go using multidimensional analysis. During the debate on the multidimensional scaling approach, there is a dispute on how to label the multiple dimensions (criteria) of relevance to respondents. More study is needed to better understand the impact of biases on the data collection procedures of multidimensional scaling initiatives. Data collection methodologies and “scenarios” for a project have yet to be defined (Biemans et al., 2010). The presented sample was based on a single person. There is currently no mechanism for getting responses from so many people. You’ll need software to do any of the analyzes outlined here. There are several types in use, but it is unclear how inputs such as the number of points and experimental error impact their outputs, if at all. In computer systems, it is typical to assume that all measurements are either linear or on a straight line. Researchers are unsure which distance functions can be used in computer applications. As a result, it is presumed that a linear model exists.

10.14. CHARACTERISTICS OF MULTIDIMENSIONAL SCALING There are several types of MDS. MDS is a broad word that encompasses a variety of MDS techniques. These versions can be classed as nonmetric or metric MDS depending on the type of data input. Metric MDS employs measurable item comparisons (interval or ratio data). However, the great majority of data in psychology is of a routine type. As a result, non-metric MDS is becoming increasingly widespread in this discipline, relying entirely on qualitative information regarding differences. MDS models are classified into subtypes using proximity, similarity, or distance matrices. Metric or nonmetric data can be utilized in a classical MDS (CMDS) matrix multiple dissimilarity matrices are evaluated in parallel by RMDS, but only one scaling solution or map is obtained (Chang et al., 2018). RMDS is widely used to investigate the stability of derived dimensions when data are gathered from numerous participants or from a single subject who has been examined multiple times.

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A nonlinear or nonmonotonic difference matrix (DIM) is utilized in weighted MDS (WMDs) to create the final result. This paradigm, also known as the INDSCAL model, permits individual variations in cognitive processes or perceptions to be taken into consideration. Using square asymmetric matrices as input data allows MDS models to be tweaked even further. For example, the rows and columns of a proximity matrix are all equal, although, in this situation, the closeness between observations i and j is not necessarily the same. MDS models and their associated procedures are available for asymmetric proximity matrices in addition to rectangular ones. In a conventional rectangular matrix, rows represent stimuli, and columns reflect the attributes of those stimuli. This section’s objective is to illustrate that there are numerous MDS models, rather than to describe them in depth. CMDS is the most fundamental sort of MDS, hence, we will focus on it in our discussion of MDS model methodology, output, and interpretation (for a complete review of the different MDS models). Model and result of the MDS is feasible to utilize non-metric MDS to represent stimuli randomly in space and then transform the proximities between points into disparities (distances). While most MDS algorithms employ Euclidean principles, a Minkowski distance model allows distances to be determined geometrically. Equation here indicates that distance (di) is defined as (d xx = (1))2 xi and (j) signify the coordinates of dimension a’s points i and j, respectively. Metric MDS utilizes a linear transformation function, whereas non-metric data apply a positive monotone transformation to scale dissimilarity data into geographic distances (Sheth, 2020). It then determines how well the input proximities and distances fit together. The stress function is minimized by repeating a strategy that seeks consecutive approximations of the solution. SPSS or Statistical Analysis Software (SAS) can be used for MDS investigation, although a map’s number of dimensions must be selected before the analysis begins. As a result, if the study is exploratory, and especially if the primary purpose of MDS is an explanation, the researcher should have an estimate of the number of projected dimensions from the data. It’s conceivable, however, to adjust the proportions of an item to minimize the load on all key software programs. Checking for clusters is a vital element of assessing the spatial map. When two or more sites on the map are geographically close to one another, they are referred to as “clusters.” Depending on the data, this may reflect a specific domain or subdomain. Diagnostics for Output The n-dimensional map’s stress quantifies the difference between the input

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and output distances. Where it is the value of the proximities between items i and j, and dij is the distance between them in space. From 0 to 1, the stress function’s values may be found, with a lower number suggesting a more precise model replication of the input data. In terms of optimal levels of stress, a number 0.1 is fantastic and anything less than 0.15 should be avoided at all costs). When stress is larger than zero, it signifies that the input data has twisted the map’s distances (Stein et al., 2013). There are two ways in which distortions could present themselves: generally diffused or tightly focused. As the number of dimensions increases, the input data and the model are more closely matched, and as a result, stress levels decrease or remain constant. However, the MDS map’s reading and understanding are limited as it grows more complicated owing to the extra dimensions. Therefore, the model may grow almost as sophisticated as the actual data. Using the squared correlation index (R2), which evaluates how much of the input data fluctuation the MDS technique can account for one can assess the model’s appropriateness. In WMDs/INDSCAL, the strangeness index quantifies how out of the ordinary each subject’s weights are compared to the weights of the average subject being evaluated. From 0 to 1, the strangeness index gauges the degree to which the subject’s weights deviate from those of the average individual. Increasingly severe ratings suggest that the subject’s intended spatial arrangement or scaling solution does not work for them. When plotting the distances between input and output for each item pair, Shepard diagrams are used. In a model with a perfect match, there should be no vertical discrepancy between the proximity and map distances (Sivarajah et al., 2020). The purpose of multidimensional scaling is to map the relative location of objects using data that show how the objects differ. Seminal work on this method was undertaken. A reduced version is one-dimensional scaling. It is applied when we have good reason to believe there is only one underlying dimension of interest. Computational tests are then performed to verify that more than one dimension does not add (substantially) to the solution of the scaling.

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Figure 10.12: An infographic on Shepard diagrams Source: https://www.istockphoto.com/es/vector/profesiones-enkazajst%C3%A1n-conjunto-de-vectores-pastor-con-oveja-y-caballo-empresario-gm1130670605–299108820?phrase=shepard%20diagram

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INDEX

A Advertising 158, 159, 160, 161, 163, 164, 165, 166, 167, 168, 169, 170, 172, 173, 174, 175, 176, 177, 178, 181 advertising strategy 110 allocating resources 216 American Motors Corporation (AMC) 80 Annual Plan Control 232, 233 artificial intelligence 9 B B2B marketing 2, 12 Behavioral analysis 218 billboards 158, 166, 168 blogs 61 Bundle pricing 123, 124 business performance 215, 233 Business value 139 C Casuistry 226, 227 catalogs 159, 160, 173 Causation 225 checklists 184

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Commercialization 61 communication procedures 185 competitive advantage 80, 81 competitive market 54 Computational tests 262 computer-aided design (CAD) 80 consumer behavior 132 consumer motivation 7 consumer segmentation 78 consumer testing 81 content marketing 184, 197, 200, 205 controlled experimentation 223 Coordination administration 153 Corporate marketing 2 corporate resources 79 Correlation 225 cost allocation 109 Cost analysis 230, 231 cost setting 109 Customer analysis 217, 218 Customer buying criteria 219 Customer Database 33 customer demographics 4 Customer demographics 221 Customer feedback 228, 229

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customer relationship management (CRM) 79 Customer satisfaction feedback 229 Customer service 229 D demand curve 109, 111 design integration 79 difference matrix (DIM) 261 direct mail 143 Direct marketing 159, 160, 161, 162, 173, 174 dispersion channel 144, 147 distribution 59, 70 document management 79 E eBay 108 e-commerce 134, 143 Effective marketing 2 Efficiency control 235, 236 email marketing 184, 189, 205 enterprise resource planning [ERP] 79 Euclidean distance 241 F Facebook 189 factor analysis (FA) 244 financial market 214 financial transactions 214 fixed-price contract 113 G geographic markets 4 global warming 240 Google Ads 188

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I inbound marketing 61 information 30, 31, 32, 33, 34, 36, 37, 38, 45, 47, 50 Instagram 189 internal data sources 32 Internet advertising 184 internet marketing 168 Internet of Things 9 inventory management 215 J journals 31, 33, 34, 158, 164, 177 K Key performance indicators (KPI) 185 L Likert Scale 254, 255 LinkedIn Learning 56 Logistics management 152, 153 M magazines 34 Management by objectives 233 management information system (MIS) 30 market activities 214, 215 Marketing budget 185 marketing campaigns 4, 18 Marketing control 216, 217, 232 Marketing control techniques 216, 217 marketing environment 31, 33 marketing expenditures 81 Marketing implementation 185 marketing implementation plan 184, 185, 186

Index

marketing implementation strategy 185 marketing intelligence 31, 33 marketing mix 108 Marketing Objectives 185 marketing personnel 184, 186 marketing planning 184 marketing procedures 184 Marketing research 35, 36 marketing software 61 marketing strategy 2, 11, 14, 15 Marketing tactics 185 Marketing team 185 marketing templates 184 marketplaces 31 market segmentation 110 Media coverage 159 merchandise 144, 147, 148, 149, 153 Merchandise 32 minimum viable product (MVP) 56 multidimensional scaling 240, 242, 243, 244, 254, 257, 258, 259, 260, 262 N new product development (NPD) 54 O Observational data 224 Observational studies 224 online display advertising 216 online shopping 132, 151 Outbound coordination 153 P Personal selling 165, 175 Personal value 139 phone calls 160, 180

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Positioning 110 PPC (pay-per-click) 168 price information 108 Priceline 108 Pricing plans 108 Pricing strategy 108 process management 79 Product Development 54, 55, 58, 59, 60, 62 Product feedback 229 Product lifecycle management (PLM) 78 Product management 78 Profitability analysis 235 Profitability control 234 proof of concept (POC) 54 psychometrics 240 Publicity 158, 169, 177 Public relations 169 Q Qualitative analysis 227 R relational data 240 Requests for quotations (RFQs) 79 research reports 34 resource management 185 Retailing 131, 132, 142 retainer agreement 113, 120 robotics 9 S sales channels 6, 18 Sales promotions 159, 160, 171 Sales promotion tactics 159 search engine optimization 187, 188 smartphones 8, 9, 13

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social media 3, 14, 15, 16 social media management 184 software as a service (SaaS) 56 sponsored advertising 166 sport utility vehicle (SUV) 80 sprints 184 Statistical Analysis Software (SAS) 261 statistics 3 stock market 32 Strategic control 237, 238 supplier relationships 79 supply chain collaboration 79 supply chain management 79 supply chains 5 SWOT (strengths, weaknesses, opportunities, and threats) analysis 57 Symmetrical Ring Structure (SRS) 242

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T target audience 2, 3, 17, 18 target costing 109 target market 2, 3, 4, 18, 19, 20 telemarketing 173, 174 television 158, 160, 161, 166, 167, 177 Testing 222, 223 transportation 215 U unconventional events 159 unique selling point (USP) 56 V Value-based pricing 121, 122 value proposition 58, 59, 66, 135, 136, 137, 138, 139, 140, 141 W website information 61 wholesaling 132, 133, 135, 140, 142, 151, 152, 154 Worth-based pricing 120, 121

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