Marketing 5000 Session 6: New Market Offerings, Global Market Offerings, Setting Product and Brandin

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Marketing 5000Session 6 New Market Offerings,
Global Market Offerings, Setting Product and
Branding Strategy

• Webster MBA Shanghai
• September 23th , 2006
• Jack Marr

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Session 6 New Market Offerings, Global Market
Offerings, Setting Product and Branding Strategy

• Review from Session 5
• New Market Offerings
• Global Market Offerings
• Setting Product and Branding Strategy

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Session 6 New Market Offerings, Global Market
Offerings, Setting Product and Branding Strategy

• Review from Session 5
• New Market Offerings
• Global Market Offerings
• Setting Product and Branding Strategy

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Review from Session 5

• Presentation outlines
• Questions on course to this point?
• Guest lecture Arto Hampartsoumian CEO BBH China
• Special lecture by Rick F. October 7th
  Marketing Promotions

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Group Presentations

• 35 of grade
• Decide on a marketing topic that covers one or
  more of the major marketing functions we have
  discussed in class planning, research,
  positioning, promotion, and channels.
• Work in groups of 4 (ideal size)
• Please approve topic with me
• Topics all in? Outline of topic and roles of
  each person
• 15 minute plus 5 minute QA Presentations on
  OCTOBER 14th

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Group Presentations

• Group 1
• Group 2
• Group 3
• Group 4

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Session 6 New Market Offerings, Global Market
Offerings, Setting Product and Branding Strategy

• Review from Session 5
• New Market Offerings
• Global Market Offerings
• Setting Product and Branding Strategy

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Developing New Market Offerings (1)

• When to develop new products? Calculus of
  potential for success (ROI and NPV) vs. potential
  for failure.
• Organizational factors Set criteria (341) (1)
  product introduced within 5 years, (2) market
  potential of 50 m and 15 growth, (3), 30 ROS
  and 40 ROI, (4) Technical or market leadership
• 3M 15 of time on new product development, but
  have to kiss a lot of frogs to find a prince
• 1/64 make it, at a cost of 14 million! (343)
• Managing Creativity Herding Cats
• Should we build a better mousetrap?
• And would it have been worth it, after all,
  After the cups, the marmalade, the tea,
• Among the porcelain, among some talk of you and
  me, Would it have been worth while,
• To have bitten off the matter with a smile, To
  have squeezed the universe into a ball
• To roll it toward some overwhelming question, To
  say I am Lazarus, come from the dead,
• Come back to tell you all, I shall tell you all
  If one, settling a pillow by her head, 
• Should say That is not what I meant at
  all.  That is not it, at all. 
• T.S. Eliot, The Love Song of J. Alfred Prufrock

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Developing New Market Offerings (2)

• New Product Development Decision Process (345)
• How to create new ideas internally? Business
  Plan Competitions (China), Japan examples (347)
• Concept to Strategy
• How to test? Factors (351)
• Virtual reality can it work? Do you use it?
• Conjoint analysis (351/2) Statistical analysis
  of factors and how they relate. Nice but must
  know the factors first!!!!
• Back to forecasts!!!! So we get line 1. Now for
  the relatively easier part. 2-11! What is your
  real return on products? Shanghai Client and
  Claudia, Break even, and cases
• Testing and validation does it work? How to
  test? Depends on the product. Apple Hell Mac.
  What do you do?
• Market testing (B2C) sales wave (customer by
  costumer), Simulated (30-40 qualified shoppers),
  Controlled (some stores and cities), Test (One or
  more cities). Increasing cost
• Market testing (B2B) alpha beta, trade shows,
  test market pros/cons?
• Timing first/ parallel/late (already discussed)
• Where? Big question. Survey of class
• RETURN TO RESONS FOR FAILURE 339

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Case

• Brainstorm new ideas for Sonic PDAs offerings
  (10 minutes)
• Select the three most promising and think of how
  you would bring them to market (5 minutes)

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Session 6 New Market Offerings, Global Market
Offerings, Setting Product and Branding Strategy

• Review from Session 5
• New Market Offerings
• Global Market Offerings
• Setting Product and Branding Strategy

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Setting the Product and Brand Strategy (1)

• A brand is a collection of images and ideas
  representing an economic producer more
  specifically, it refers to the concrete symbols
  such as a name, logo, slogan, and design scheme.
  
• Benefits and levels of benefits p. 410
• Core benefits/ Hotel rest and sleep
• Basic product/ bed, bathroom, desk, closet
• Expected product clean bed, fresh towels,
  working lamps, peace and quiet
• Augmented product exceeds expectations.
  Malaysian hotel stay surgery
• What about your companys main product? Spend a
  few minutes thinking
• Remote control television becomes expected
  (frequent flier programs)
• Potential product all possible offerings (PG
  website)

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Setting the Product and Brand Strategy (2)
Classifications of consumer goods Convenience
staples, impulse, emergency Shopping goods
compare suitability, quality, price, and
style Specialty goods special purchases, buyers
will spend time to find them. Mercedes, good
vegetables? Unsought goods life insurance,
cemetery plots, encyclopedias Classifications of
industrial goods Raw materials fish, lumber,
crude petroleum, iron ore. Farm products wheat,
cotton, Capital items installations (factories,
offices) large purchases, equipment (small
purchases), supplies, services (maintenance,
advisory) Product length number of
types Product width number of similar categories
(414)
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Setting the Product and Brand Strategy (3)

• Brand Decisions
• Brand the art and cornerstone of marketing
• Should you invest in brand building? And can you
  command a premium by building brand?
• China and Vietnam, history of non-branding
• Taiwan focused on OEMs and still successful
• name, sign, symbol, or design, or combination of
  them, intended to identify the goods or services
  of one seller or group of sellers and to
  differentiate them from those of the
  compeitiors. American Marketing Association
  (420)
• Six levels of meaning attributes, benefits,
  values, culture, personality, user Mercedes
  example (420)
• Companies need to research the position their
  brand occupies in the customers minds.
• How is this related to positioning?????
• Methods word association, brand
  personification, brand laddering to the essence
  Examples?

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Setting the Product and Brand Strategy (4)

• Building brand identity Logos. Think of some
  famous logos. Samsung example, 422
• Advice on new economy 423
• 5 levels of brand loyalty
• No loyalty, will change easily (including price)
• Satisfied
• Satisfied and will incur switching costs
• Values brand and sees it as a friend
• Devoted to the brand
• Customer will pay more for a strong brand Tide
  and Heinz 100 premium, Lexus and Camry use same
  engine but Lexus commands 10,000 more
• Vs. brand valuation Nestle acquires Rowntree,
  Carnation, Stouffers, Buitoni, Perrier to become
  worlds top food company
• Top 10 brands by value (1) Coca-Cola (70 bn),
  Microsoft (64 billion), IBM (51 bn), GE, Nokia,
  Intel, Disney, Ford, McDonalds, ATT
• Virgin from a record label to everything. Brand
  dilution? I see no reason why we should be
  frightened about launching new products Richard
  Branson

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Setting the Product and Brand Strategy (5)

• Top Asian Brands Toyota (12), Honda (18), Sony
  (21), Nintendo (32), Samsung (34), Canon (43),
  Panasonic (81)
• Ian Bartley Asia should aim for 20 of top 50 by
  2020.. Is this possible?
• Golden assets natural commodities
• Acquired assets long history
• Potential assets built from scratch
• Mix
• Which is most appropriate for China?
• Many global brand leaders from 70 years ago still
  are Wrigleys, Gillette, Coke, Heinz, Campbell
  Soup. In Asia, Mikomoto, Tiger Balm, San Miguel
• Earliest brands medeival guilds trademarks and
  artists signing work
• To brand or not and how? Branding decision tree
  p. 427

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OEM to ODM to Brand Value Chain

• Description
• Makes to spec
• Low level of technology
• Low margin
• Compete on price
• Aids with design specs
• Higher level of technology
• Higher margin
• Compete on price and design
• Own technology and end
• customer base
• Technology leader
• Highest margin and risk
• Compete on all fronts

OEM
ODM
Branded
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Setting the Product and Brand Strategy (6)

• Generics started by Carrefour in 1970s.
  Unbranded, plainly packaged, cheaper
• Manufacturer brand Watsons, Uni-president
• Profitable, as can use overstock from producers
  and can differentiae retail. Can be used in B2B
  as well (CSI example)
• Branding on web challenges (1) one-one nature,
  (2) ineffective format, (3) consumers in control
• Types of brand names
• Individual names PG (Head Shoulders, Pantene,
  Rejoice)
• Blanket families, sometimes with brand Hitachi,
  Sony Walkman, Sony Playstation, Microsoft
  Windows, Microsoft Explorer, etc.
• Separate names for all products Matsushita,
  Starwood
• Whats in a name? Should
• Suggest benefits Sharp, Walkman
• Suggest category Newsweek
• Suggest high-imagery qualities Sunkist
• Easy to learn and remember Kao, Qoo. But, Haagen
  Dazs. Where from?
• Distinctive Kodak, Lux, Xerox, Acer
• Not have bad meanings Nova, Barbie in Malaysia
  (Pork!) and selected on a global/ regional basis

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Setting the Product and Brand Strategy (6)

• Whats in a name? Should (cont.)
• 7. Convey appropriate symbolism Deltas fake
  hanzi
• 8. Consider history.
• How to? Brainstorm and test final with with
  target customers
• Extending brand
• Line extensions several similar items in
  different types ie Dannon yogurt
• Kleenex Get facial tissue in every room of the
  home if there it will be used
• Brand extensions put brand on other products
  Six Hondas in a two car garage
• Brand licensing Hello Kitty!, B2B with
  Caterpillar
• Cobranding alliance with other firm such as
  Raffles/ Singapore Airlines, Intel Inside Why
  not other components? Bike magazine
• Brand asset management PR, press releases,
  sponsorships, clubs, factory visits (Bao Steel!),
  trade shows, events, public facilities (Coke and
  Pepsi lights in Shanghai or Chicago),
• How is your brand? Report card p. 442
• Case HSBC Midlands 1998.

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Setting the Product and Brand Strategy (7)

• Packaging and labeling 5 Ps? (price, product,
  place promotion)
• Self-service sells itself. Evian, Dannon
• Affluent pre-cut, pre-washed. Or better
  packages no opening???
• Brand image instant recognition
• Innovation the toothpaste pump, liquid soap
• Labeling think of local tastes
• German breakfast cereal story

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Case

• Brainstorm in your group, based on last weeks
  positioning, to come up with a brand name for
  your PDA. Remember, it should be
• Suggest benefits Sharp, Walkman
• Suggest category Newsweek
• Suggest high-imagery qualities Sunkist
• Easy to learn and remember Kao, Qoo. But, Haagen
  Dazs. Where from?
• Distinctive Kodak, Lux, Xerox, Acer
• Not have bad meanings Nova, Barbie in Malaysia
  (Pork!) and selected on a global/ regional basis
• Also, make suggestions, if any, on the design and
  packaging
• Spend 10 minutes brainstorming and several
  minutes presenting. Class will respond with what
  the brand name makes them think of

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• Next Week
• Rick F.
• Ch. 19,20