Business 201: Marketing Summarized

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Marketing is the entire process of selling any goods or services

  • A good product is something offered that people believe will add value by getting it
    • Therefore, marketing is built around providing meaning and purpose to a customer
    • The product has to be seen as worth it
      • Worth the effort to adapt a lifestyle for it
      • Worth being identified with the culture surrounding the product
      • Worth the effort to actually acquire the product
      • Worth the continued maintenance required to possess the product
  • Products are not always tangible and aren’t always being sold for money
    • Job hunting, since a person looking for a job is marketing themselves
    • Making a humanitarian call to action, since it is advocating for a cause
    • Proselytizing/evangelism, since it is trying to sell a perspective
  • The 4 P’s of marketing:
    • Product – what are you delivering?
      • Even if it’s a service or the feeling of goodwill, there is always a product
    • Promotion – how are you delivering it?
      • This is the method of conveying the idea that the product is being presented
        • This is absolutely necessary, since there’s no other way a potential customer could know otherwise
    • Placement – where is it being delivered?
      • Even in the Internet age, this still matters
    • Price – what does it cost?

Marketing is built around the idea of trends

  • The customer’s decision-making process
    • People get products for a few specific reasons or a combination of reasons:
      • Basic needs like food
      • Replacements like household items
      • Urgency or scarcity like medications
      • A great value like a sale
      • A good cause like a bake sale
      • Name recognition
    • Every consumer goes through a simple and predictable cycle when looking for a product:
      1. Recognizes a need that needs to be fulfilled
      2. Searches out information that will lead to fulfilling that need
      3. Evaluating alternatives from that gathered information
      4. Purchasing or investing into that decision
      5. Responding after the purchase based on expectations versus reality
    • Multiple factors determine the amount of investment the customer will make
      • Previous experiences
      • Interest in the product
      • Perceived risk of negative consequences
      • The current situation and what it calls for
      • The social visibility of the investment
    • There are 4 kinds of products that are ever really purchased
      • Convenience products that make life easier
      • Shopping products that are staples to a lifestyle
      • Specialty products that appeal to a specific need or want
      • Unsought products that the customer is unaware even exists
  • What’s popular is what the consumers and potential customers think
    • Customers will find meaning in the product as candy, vitamins or painkillers
      • Candy – fun, enjoyable, people can easily live without it
        • Beauty through physical improvement
        • Creation in having produced something new or original
        • Freedom from living with unwanted constraints
        • Harmony by being in a balanced relationship to the whole
        • Oneness with what is around us
        • Wonder and awe in the presence of something beyond explanation
      • Vitamins – non-essential but helpful, important but not urgent
        • Accomplishment through attaining goals or status
        • Community from closeness with others
        • Enlightenment by appealing to logic or inspiration
        • Truthfulness by applying honesty and integrity
      • Painkillers – solves a painful problem, necessary for those who need it
        • Duty in fulfilling responsibility
        • Justice from fairness and equality
        • Redemption through atonement or forgiveness from past failure or decline
        • Security from risks of worry or loss
        • Validation of one’s value and worthiness of being respected
    • The customer creates meaning through how they are involved with the product
      • Interactivity – the ones that directly contribute to meaning
        • Control – how much they can manipulate the depth of the experience
        • Adaptability – how much they can change the experience
        • Feedback – how the customer is updated
        • Communication – the amount the customer feels heard about their opinions
      • Triggers – subconscious connections to meaning, very risky to use to start building a brand
        • Language – words and phrases that bring thoughts with them (highly relative!)
        • Symbols – designs that come to the senses and bring a connection with them
        • Sensations – too difficult to use, but are the interpretations of the senses
    • How a person creates meaning as they look at a product varies on a lot of factors
      • The product itself
        • Attributes of the product
        • The emotional reaction that comes from the product
        • Price and quality
        • Use, application and benefits the products will provide for the customer
        • The class of the product in relationship to other products
        • Past views of the product from prior branding
        • Amount of use of the product
      • Geographical location
        • Geodemographics – neighborhood lifestyle categories
      • Demographic factors
        • Age
        • Gender/orientation
        • Income
        • Ethnic groups
        • Family lifestyles
        • Psychographic group – psychological tendencies from the environment
        • Personality
        • Lifestyles and motives
  • There are also other factors in the marketing environment
    • Internal factors
      • The design of the product and its implications
      • Where the product was made, which can make it cheaper or give a loyalty to its creation
      • The quality of the product compared to others on the market, if any
      • The way the product is distributed
    • External factors
      • Personality traits and lifestyles of people who use the product
      • Current customers’ motivations for getting the product
      • Potential customers and what they would like out of the product
      • Very important customers and why they like the product
      • Competitors and how their product is different or how the global marketplace looks
      • Technological limitations of the product and the possibility of the product becoming obsolete
      • Legal issues involving the legality of the product, the ability to protect intellectual property and how much it will cost
    • Every culture will progress from rural to mass-industrialization, and this creates a shifting marketing environment
      • Simple Trade Era – people make most of what they consume
        • The greatest selling comes from luxuries and raw materials
      • Industrial Revolution – technological growth, larger scale of products
        • Mass-produced items means improving the quality of the product
      • Entrepreneurship – multiple organizations trying to defeat each other competitively
        • At this point, the ability to compete becomes more important than the ability to be competent
      • Production Era – emphasis on lowering costs and increasing productivity
        • The most successful companies will look inward to stay ahead of competitors
      • Marketing Era – creation of distinct brands
        • The ability to brand in a way that creates niche markets becomes vastly important
      • Relationship Era – maintaining customers through relationships
        • From here, companies need to manage the company’s image through customer-oriented personnel, emphasized training and empowering employees
    • The key to creating a lasting marketable product is to make a competitive advantage that can’t be reproduced
      • Unless it’s the cheapest thing on the market and being made in a poor part of the world, it’s impossible to differentiate with cost and nothing else
    • Learn to follow the conditions of a new trend to find the best time to seize an opportunity
      1. New trend starts as a reaction to something mainstream
      2. Different kinds of trendsetters adopt the new trend
      3. A high number of trendsetters adopt the trend
      4. The trend first emerges in a major city that has a history of many trendsetters
      5. The trend quickly spreads to other major cities with histories of many trendsetters
      6. Ongoing product and/or design development early in the trend process
      7. Products or style are able to be copied or imitated
      8. Many of the trendsetters’ media features the trend in articles
      9. There is a connection between popular movies and the trend

Good marketing requires good data, which comes from good marketing research

  1. Create a market segment
    1. Select a market or product category for study
    2. Choose a basis or bases for segmenting the market
    3. Select the groups you want to test
    4. Profile and analyze the groups
    5. Select target markets inside the groups
    6. Design, apply and maintain appropriate mixes for those target markets
  2. Collect secondary data from the internet and marketing research aggregators about the target market
  3. Plan the design of the research and gather primary data
    • In-person/mail surveys
    • In-home personal interviews
    • Mail/email/telephone reviews
    • Executive interviews
    • Focus groups
  4. Design a questionnaire around what you want to learn
    • Ask what the person observes
    • Observe the demographics and what they think
    • Use virtual shopping to perform observation research
  5. Experiment using the scientific method
    • Specify the sampling procedures
      • Samples that are very probable
      • Samples that aren’t probable
    • Account for sampling errors or errors in creating a guided result
    • Collect and then analyze the data
    • Prepare and present a report
  6. Follow up on the data with a decision support system
    • Make it interactive to allow people to engage with the process
    • It should be flexible to allow changes as they come and allow data to be manipulated
    • Make the focus on finding new solutions instead of using tried procedures
    • The system should be accessible to keep anyone interested up to date

A marketing plan needs to be consistent across several dimensions

  • Breadth of expression
    1. Product – the physical object itself
    2. Service – the delivery of the experience
    3. Brand – the declaration of uniqueness
    4. Channel – how the product gets to the customers
    5. Promotion – how the potential customers learn about the product
  • Duration of experience
    • Initiation – the customer’s first impression when hearing about the product
    • Immersion – the customer’s first interaction with the product itself
    • Conclusion and continuation – the customer’s views as they compare other products
      • Choice overload is when the customer feels they have too many choices, and there are ways to remove it
        • Cut down on the least-selling things, especially if people can’t tell the difference between the products
        • Indicate the consequences of each choice where they are felt in some way
        • Create more meaningful categories
        • When choices are presented as multiple questions, go from less choices to sequentially more choices
  • Intensity
    • Impulse – the least intense connection with the customer, usually only with low-cost or extremely generic products
    • Habitual – habits developed from a need for convenience or efficiency
      • Great products create a consistent habit, even if it’s once a month, from high quality content
    • Engagement – things that grab the customer’s attention throughout the experience
      • This is also known as the Stickiness Factor, and will be seen as unconventional, unexpected and contrary to received wisdom

Colors are extremely important in marketing

  • Colors create instant judgments that go past the conscious and define what people think about something literally seconds after seeing it
    • 85% of buyers will choose a product on color alone
    • 93% of buyers are concerned about the visual appearance of a product
  • Why this matters
    • If you are in design-based work, you need to know what people will think
    • If you buy products, you need to know what they’re trying to imply
    • If you are in a place of business, you need to know the atmosphere they are trying to create for you
  • Colors all give a certain feeling based on their perceived temperature
    • Warm Colors (red, orange, yellow, gold, pink)
      • Tend to have an exciting effect
      • Can stimulate hunger, impatience and aggression
      • Can overstimulate and agitate when used alone
        • Needs other groups to not be overwhelming
    • Cool Colors (green, blue, purple)
      • Gives a calming effect on the viewer
      • Can feel cold or impersonal when used alone
        • Needs other groups to not feel alienating
    • Neutral Colors (white, grey, silver, brown, black)
      • Great for mixing and as backgrounds in designs
      • Tones down the intensity of other colors
      • May be seen as boring if not mixed with other colors
  • Some colors are odd
    • Yellow is usually disliked, but those who like it are in love with it
    • Depending on the shade, blue can either be a very masculine or very feminine color
    • Black is a very bold and polarizing color
    • After 30 minutes of looking at it, pink will calm people down
  • There are 3 kinds of spenders:
    • Average spenders – 61% of the people
      • Often prefers pink or sky blue
      • Clothing stores use these colors for this reason
    • Cheap spenders – 24% of the people
      • Often prefers navy blue and teal
      • Banks and department stores use these colors for this reason
    • Irresponsible spenders – 15% of the people
      • Often prefers orange, blue or black
      • Malls, clearance sales and fast food prefer these colors for this reason

Marketing is about maintaining a brand

  • There are different levels of branding, depending on the product
    1. Production Orientation focuses on the internal capabilities of the company instead of the desires and needs of the marketplace
      • Marketing myopia comes when a business is defined in terms of goods and services instead of the benefits customers look for
    2. Sales Orientation focuses on applying aggressive sales techniques
    3. Market Orientation focuses on satisfying customer wants and needs
    4. Social Marketing makes the company’s goals for the betterment of society
  • The most obvious branding is the product’s packaging itself
    • The package is meant to hold and protect the product, but also can help promote the product through labeling
    • Universal Product Codes (UPCs) can track the package more easily than directly on the product
    • The packaging can help the product be stored, used or made more convenient
    • Often, the packaging can be recycled as an eco-friendly branding
  • Branding is about declaring the product’s uniqueness, and that requires having a goal behind every design
    1. Identify the audience you want to make leads for
    2. Create a message or story with the design
      • Use the Golden Circle to build your message
        • WHY something is valuable, first and foremost
        • HOW that value is conveyed, next
        • WHAT the product that provides the value is, finally
      • Pay attention to the medium you want to design onto
      • Make the experience of consuming the branding memorable
        • Show the product in action
        • Use current social trends in your branding
        • Create interviews or testimonials from reputable or influential individuals
        • Advertise how helpful your organization is
        • Show how horrible life is without your product
        • Donate your product or merchandise credit as a prize in a competition
        • Publicly speak at events
    3. Make the message resonate with the target demographic with something eye-catching and familiar
    4. Send out the product on all the appropriate social channels after tailoring it to the medium
      • Social networks (Facebook, Twitter, Google+, etc.)
        • Be wary of following everyone, since not everyone wants the product
        • Sometimes it’s a good idea to dial up the volume of posts to make up for the deluge of competitors
        • Involve visual media to keep it interesting
      • Media-based social networks (Pinterest, YouTube, Instagram, Tumblr, etc.)
      • Email
        • Don’t over-send emails or people will try to find the “unsubscribe” button
      • News aggregators (Digg, Reddit, etc.)
      • Try an unconventional channel to create unconventional leads
        • A channel that isn’t usually used for your product
        • News that you publish on your organization’s own website
        • Create targeted advertising that appeals to specific time-based desires
          • Cold-weather items or hot comfort foods on weather websites that show cold weather
          • Odd demographics that seem to like specific combinations of products
    5. Follow up with the social media publicity and keep the conversation going with people
      • When choosing social media outlets, do all possible ones that correspond to what you can do
      • Take photos and videos of everything pertaining to the product and display it
        • Videos are extremely personal tools, so use them with the idea of connecting with the customers intimately
      • Pay attention to positive online reviews and showcase creative or inspiring reviews
      • Provide discounts, sales and coupons for social media to keep people coming back to your content
      • Keep analyzing to find the right people who want your product, and change the marketing plan to match it
  • Brands are often repackaged with different items, lines and mixes
    • Advertising can be more focused on target demographics
    • Packages can maintain a uniform feel from product to product
    • The brand’s components can be standardized across products
    • It’s a lot easier and efficient for sales and distribution
    • The quality can be comparable
    • There are a lot of ways to repackage a brand
      • Modify the product’s quality, function or style
      • Reposition the same product as a different brand entirely
      • Create extensions to the product line
      • Condense product lines into one joint product
    • There are many large-scale strategies when changing brands
      • Create a generic brand or a manufacturer’s brand to pick up more demographics
      • Create individual or family oriented brands to appeal to a new group
      • Co-brand with a separate industry that shares a demographic
      • Create a universal brand with sub-brands or adaptations to the brand
      • Have region-specific brands that are completely unrelated to each other
    • Anytime you want to expand your market, there are a few broad ways to go about it
      • Market penetration – move into a brand new market
      • Market development – improve the current market standing
      • Product development – make a better product
      • Diversification – make brand new products
  • A lot of things can really damage a brand
    • A lousy looking brand
      • Too much visual clutter
      • Doesn’t match the conveyed feeling of the product
      • Too boring for the customer
    • A lack of proper planning
    • An inconsistent brand image
    • The brand gets connected to a low-quality product or low-quality content
    • The brand promises things that it can’t deliver
    • Online marketing opportunities are underestimated or not used
    • The organization doesn’t listen to the audience’s input
    • The website is badly designed, obsolete or hard to navigate
    • The brand somehow crosses the line past uniquely different into offensive
  • Customers are guaranteed to leave, even with the best branding possible
    • 1% will die
    • 3% move physically away from the product’s influence
    • 5% develop new friendships that change their demographic
    • 9% leave for a competitor’s superior fulfillment of needs
    • 14% become too dissatisfied with the product
    • 68% leave from feeling that an employee had an indifferent or improper attitude towards them

One of the most intense versions of marketing is the one-on-one experience of sales

  • Sales is a matter of numbers
    • If 100 calls will give 1 lead, then every call is 1 more toward achieving that lead
    • Only people with a high confidence level can thrive in sales from all the rejections they come across
  • Sales has developed a bad reputation for aggressive sales techniques
    • Social science has shown that people are only guaranteed to refuse a product after the 3rd time saying “no”, and high-pressure sales exploits that
  • Sales tricks that have been proven to work are sometimes very morally questionable
    • Sample:
      Normally an elite real estate training program from tried-and-true experts like this is worth over ten thousand dollars, but today only you can get the entire training for not $10,000, not $1,000, not even $300! Today only you can get it all for only $183! And, to sweeten the offer, if you call within the next 15 minutes you will also get a free set of Ginsu Knives! A $500 value for free! How will you spend your millions? You’re minutes away from breaking free of the grind and on your way to living the dream—all you need to do is call us at 555-555-555. Call now. There are only 5 spots left! Our expert advisers are taking calls right now!

      1. Exclusivity: “elite real estate training program”
        The appearance of a unique and prestigious product make customers more likely to participate and will spend more on a brand for the feeling of exclusivity
      2. Authority/Power: “tried-and-true experts”
        Through various techniques, the seller wants you to believe they have the market cornered on information
      3. Comparison: “not $10,000, not $1,000, not even $300”
        The differences are embellished by being placed side-by-side to imply a drastic change, also works for numbers
      4. Urgency: “Today only you can get”
        The more time a customer has to deliberate the less likely they will make a purchase
      5. Specificity: “get it all for only $183”
        Specific numbers give the appearance of a purpose behind the number, hence no room for negotiation
      6. Free: “A $500 value for free”
        Adding in a free bonus gives the illusion of extra value to a product, essentially over-delivering, and also implies that they should give back something in return
      7. Pleasure Sensation: “How will you spend your millions?”
        Invokes pleasure sensation to make the customer feel the item before buying it
      8. Pain Relief: “breaking free of the grind and you’re on your way”
        Creates or embellishes the pain in order to make their product seem to be relief
      9. Scarcity: “…only 5 spots left”
        Combination of Urgency and Exclusivity, artificially increases demand, can be limitation in time or in quantity
      10. Social Proof: “expert advisers are taking calls right now”
        Gives psychological confirmation of customers experiencing excellent service
      11. Confidence: (the general tone)
        Provides a general view that this person has a reason for being confident, meaning their product may be legitimate
  • It costs a lot more to acquire new clients than to maintain client relationships
    • Because of this, the aggressive sales model has become outdated and replaced with the Customer Relationship Management (CRM) philosophy
      • CRM is designed with the premise that there is a give-and-take relationship between the customer and the service provider
      • The attitude is completely different, since it focused on win-win through prolonged relationship-building instead of a one-time benefit for the seller
    • CRM’s strength goes beyond the marketer’s work
      • Instead of selling, let others sell for you through their passion for your product
        • Referrals come through connections of connections
        • Affiliate marketing is from related workers in the industry who naturally work well alongside your group
  • Effective marketing is called pipeline marketing
    1. Generate leads through connections, advertising and many other places
    2. Sift through the leads to create prospects that might get the product
    3. Engage routinely with the prospects until they become your client
    4. Treat your clients especially well to maintain your reputation throughout the engagement
    5. Create more leads and prospects through referral marketing

Modern-day marketing ties to how well the product is advertised on the Internet

  • Not every industry needs a website, but it can be useful
    • Depending on the industry, a badly made website can actually be worse than no website
    • Technology is a vital tool, and any business that wants to stay competitive must stay current
  • There are levels of complexity for a website
    1. The most basic form of a website is to simply convey information (e.g. this site)
    2. When the site creates a public forum for ideas, the information becomes user-driven (e.g. reddit)
    3. A site that is nearly all user-made content can still be straightforward in presentation (e.g. Wikipedia)
    4. When that site requires many complex permissions rules to view content from different users, it’s as complex as it can get (e.g. any social network site)
  • Online marketing has a lot to do with getting hits (visits to the site)
    • Something goes viral if it gets enough hits to become wildly popular
    • Not all hits are good
      • Complaints should be managed online, since any savvy stranger risks making them go viral
      • Ideally, the best way to resolve complaints is through an on-site instant messenger service
  • There are a ton of tricks to improving the number of hits to your content
    • When creating the framework
      • Official channels to advertise your content make the name show up more frequently in search results
      • Create links to naturally and seamlessly connect everything and add social media sharing buttons all over
      • Make sure the web domain (something.com) pertains to what you’re trying to sell
      • To avoid the homepage being cluttered, make a blog that runs on a separate non-home page
        • Invite industry experts to contribute to your blog
    • When posting
      • Use compelling images to grab the reader’s attention
        • White text with a black outline can be read on any color background
      • Capture the target demographic with a strong and keyword-laden title/header and matching description
        • Use statistically improbable (long-tail) search words with very specific keywords
      • The more verbose and descriptive the descriptions are, the more they show up in search results
      • A text transcript of a video will increase search engine results
      • Do unconventional things to make people click on your content more often
      • Create as many relevant links as possible to any other content that you want to advertise
    • Routinely
      • Re-post content on social media
      • Re-post great quality content again elsewhere with a creative remix
      • Verify that everything is visually presentable, links work correctly and everything conforms to the brand image
      • Schedule content posts that show the brand in a new light
      • Re-order the links to put the best content first
      • Network with others to link across websites
      • Blog with a regular pattern to show search engines the site is live
        • Stop selling the product and instead solve a problem for the reader
        • Create a community by opening up the end for questions and then answering them
  • The purpose of online marketing is both to maintain the long-term brand and to get people to talk about the product with each other in person
    • Don’t waste your time on social channels that don’t speak to your audience
    • Do it ethically, since anything that’s unethical is likely to get blacklisted by search engines
      • To “game” search engine systems guarantees that your spikes in views will only be temporary
      • High-quality content is seen as more effective at getting search engines’ attention
    • Try offline guerrilla marketing to get people to visit the site
      • Leave sticky notes in random places or use them to create temporary images on buildings or cars
      • Use chalk on sidewalks to advertise promotions
      • Leave branded pens at banks or other public places
      • Donate branded bookmarks to a library
    • Give out business cards with the site on it
      • Leave it with a tip
      • Put it on a public bulletin board
      • Go to the library and place business cards in books related to your business
      • Place one in a contest fishbowl
    • Try to keep the bounce rate low (where people visit the site and then leave it right away), since search engines hate it
    • Try more technical tricks like using semantic markups or editing the meta tags
 Next: Problems With Multi-Level Marketing (MLM)