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I. SITUATION ANALYSIS A.Marketing & Promo Mix B.Consumer / Market / Environment C.Competitive Situation D.Marketing / Advertising Objectives E.Creative.

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Presentation on theme: "I. SITUATION ANALYSIS A.Marketing & Promo Mix B.Consumer / Market / Environment C.Competitive Situation D.Marketing / Advertising Objectives E.Creative."— Presentation transcript:

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2 I. SITUATION ANALYSIS A.Marketing & Promo Mix B.Consumer / Market / Environment C.Competitive Situation D.Marketing / Advertising Objectives E.Creative Strategy Topic: Marketing Situation Analysis Note: Only B (excl. environment) & C will be discussed in the slides following. This power-point slides are intended for students who haven’t completed Com 352 and provide a review of some basic knowledge concerning situation analysis. Handouts are available for the asking.

3 B. Consumer, Market, Environment 1. Market (Geographic) Analysis 2. Consumer (Demography, Usage) Analysis 3. Environmental (Constraint) Analysis Topic: Marketing Situation Analysis B. Consumer, Market, Environment

4 1.Market Analysis Sales Potential Indicators: CDI & BDI n When market sales data are available: CDI % of Category Sales = /% of Persons Topic: Marketing Situation Analysis B. Consumer, Market, Environment BDI = % of Brand Sales /% of Persons

5 1.Market Analysis Sales Potential Indicators: CDI & BDI n When market sales data are NOT available: CDI % of Category Users = /% of Persons Topic: Marketing Situation Analysis B. Consumer, Market, Environment BDI = % of Brand Users /% of Persons

6 1. Market Analysis How are CDI/BDI used? Simple scenario approach Topic: Marketing Situation Analysis B. Consumer, Market, Environment

7 1. Market Analysis How are CDI/BDI used? Other Weighting Approaches Topic: Marketing Situation Analysis B. Consumer, Market, Environment n Equal weights:.5BDI +.5CDI n Unequal Weights (examples): n.75BDI +.25CDI n.33BDI +.67CDI Note: BDI/CDI are only two of many indicators of market potential and thus used with other market indicators in media/target decisions

8 1. Market Analysis Topic: Marketing Situation Analysis B. Consumer, Market, Environment Example 2 (see handout) : CDI & BDI  What do CDI and BDI for Seattle indicate about its market potential? CDI Setl. = BDI setl. = 1.78.93 X 100 = 191 1.56.93 X 100 = 168

9 1. Market Analysis Topic: Marketing Situation Analysis B. Consumer, Market, Environment Example 2 : CDI & BDI  What do CDI and BDI for S.F. indicate about its market potential? CDI S.F. = BDI S.F.. = 2.82 1.69 X 100 = 167 3.0 1.69 X 100 = 178

10 1. Market Analysis Example 2: CDI and BDI Topic: Marketing Situation Analysis B. Consumer, Market, Environment With equal weights given:.5BDI +.5CDI n Seattle =.5 X 168 +.5 X 191 = 180 n San Francisco =.5 X 178 +.5 X 167 = 153 Note: Based on the BDI and CDI alone, you will choose Seattle to spend surplus ad budget.

11 1. Market Analysis Example 2: CDI and BDI Topic: Marketing Situation Analysis B. Consumer, Market, Environment With un equal weights given:.75BDI +.25CDI n Seattle =.75 X 168 +.25 X 191 = n San Francisco =.75 X 178 +.25 X 167 = Note: With the BDI and CDI weighted unequally, you will choose San Francisco to spend surplus ad budget.

12 1.Market Analysis Sales Potential Indicators: CDI & BDI n When market sales data are not available: (case for your project) BDI % of Brand Users = = # of B. Users in Market # of Persons in Market OR /% of Persons / # of B. Users in Population / # of Persons in Population Topic 2: Marketing Situation Analysis B. Consumer, Market, Environment X 100

13 1.Market Analysis Sales Potential Indicators: CDI & BDI n When sales data are available by geo market: BDI % of Brand Sales = = B. Sales ($) in Market # of Persons in Market OR /% of Persons / B. Sales in U.S. / # of Persons in US Topic 2: Marketing Situation Analysis B. Consumer, Market, Environment X 100

14 1.Market Analysis Sales Potential Indicators: CDI & BDI n When data are not available: CDI % of Category Users = = # of C. Users in Market # of Persons in Market OR /% of Persons / # of C. Users in US / # of Persons in US Topic 2: Marketing Situation Analysis B. Consumer, Market, Environment X 100

15 2. Consumer Analysis Sales Potential Indicators: CDI & BDI n When sales data are available by consumer segment: CDI % of Category Sales = / % of Persons Topic: Marketing Situation Analysis B. Consumer, Market, Environment BDI = % of Brand Sales/% of Persons

16 Sales Potential Indicators –CDI, BDI n When sales data are NOT available Note: Sales potential indicators, CDI or BDI, are derived from MRI or Simmons data which report the product or brand usage index in ‘D’ column CDI % of Category Users = / % of Persons Topic: Marketing Situation Analysis B. Consumer, Market, Environment 2. Consumer Analysis: BDI = % of Brand Users/% of Persons

17 Sales Potential Indicators –CDI, BDI n MRI Index (for Category)-- E.g., age 18-24 % of All Category Users = = # of C. Users in 18-24 # of Persons in 18-24 / % of All Persons / # of C. Users in All ages / # of Persons in All ages Topic: Marketing Situation Analysis B. Consumer, Market, Environment 2. Consumer Analysis: X 100

18 Sales Potential Indicators –CDI, BDI n MRI Index (for Brand): E.g., age 18-24 % of All Brand Users = = # of B. Users in 18-24 # of Persons in 18-24 / % of All Persons / # of B. Users in All ages / # of Persons in All ages Topic: Marketing Situation Analysis B. Consumer, Market, Environment 2. Consumer Analysis: X 100

19  How Is MRI/Simmons Index used? - Does the segment with the highest index have the greatest sales volume potential? Age 18-24 25-34 35-44 % Pop 13 20 36 % Users 17 18 33 Calculation (17/13)X100 (18/20)X100 (33/36)X100 Index 131 90 92 Topic: Marketing Situation Analysis B. Consumer, Market, Environment 2. Consumer Analysis:  Why or why not? Example:

20 How consumer segments should be analyzed for sales volume potential : Volume Potential 18-24 = Volume Potential 35-44 =.17X131=22.3.33X92=30.4 Topic: Marketing Situation Analysis B. Consumer, Market, Environment 2. Consumer Analysis ---Use User Size and Index; Weigh User Size by Index to determine volume potential (value) of segment Note: the volume potential above is not actual sales volume but estimated composite weight that takes on meaning only when compared to other composite weights

21 C. Competitive Assessment: 3 Components 1. Market shares for all direct and indirect competitors 2. Competitive (and your) media mix and expenditure (in $ and % of their budget) 3. Share-of-Voice or Ad Share (brand’s expenditure as % of all brands’ spending Topic: Marketing Situation Analysis

22 1. Competition & Market Shares n For your project, Use LNA/Media Watch Data for competitive mix & expenditure and SOV n Our library has 1994 data (Jan-Sept), UCLA, management library has 1999 data. Topic: Marketing Situation Analysis C. Competitive Assessment

23 1. Competition & Market Shares n Direct Competition: n Indirect Competition Topic: Marketing Situation Analysis C. Competitive Assessment Brands in the same product class as yours; e.g., Brands in one or more different product classes; e.g.,

24 2. Media Mix & Expenditure (2 tables or 1 combined table) Topic: Marketing Situation Analysis C. Competitive Assessment  Raw Expenditures Table -- to show, for each competitor (& you): What media types have been used and how much ($) has been spent in each of the media?  Media Proportion Table Note: the two tables above may be combined into one as in the LNA exercise provided What percent of the brand budget is spent in each medium?

25 Topic: Marketing Situation Analysis C. Competitive Assessment 2. Media Mix and Expenditure

26 Topic: Marketing Situation Analysis C. Competitive Assessment 2. Media Mix and Expenditure

27 3. Share-of-voice or Ad Share (in %) Overall: SOV = Brand Y’s total $ x 100______ All Competitors or Brands total $ In Each Medium: SOV = Brand Y’s $ in medium x 100______ All Competitors or Brands total $ in medium Topic: Marketing Situation Analysis C. Competitive Assessment

28 Example (see handout) n SOV Sealy/Overall = (29,851.6 / 58,222.4) x 100 = 51.3 % (316.4 / 9,307.4) x 100 = 3.4 % Topic: Marketing Situation Analysis C. Competitive Assessment 3. Share-of-Voice (SOV) SOV Sealy/Mag =

29 Guidelines in Assessing Competitive Efforts 1)From competitive media mix table, determine what media have been used heavily and what rarely, and consider their implications for your own media mix -- what media must be used and why and assess threats and/or opportunities that might exist in the use of certain media Topic: Marketing Situation Analysis C. Competitive Assessment 2)From SOV analysis, assess your strengths/weaknesses against the competition, and see if any change in the mix and/or increase or decrease in spending for certain media is warranted for an effective media mix for your brand. Example: LNA Exercise #4

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