2. Problem Identification – Part 1 Lecture 3

3. 2 Recall… Recognition of Need Becoming Informed Problem Definition Concept Generation Concept Selection Embodiment Optimization Fabrication

4. 3 Recognition of Need  Who defines NEED?  Is NEED nicely defined? ill defined?  How to define and analyze NEED?  What is the effect if NEED is misinterpreted? Recognition of Need Becoming Informed Problem Definition

5. 4 Need  Who defines NEED? User – custom-designed Available technology – computer technology, communication tech, military, automotive, aero Market trend – fashion, automotive  Is NEED nicely defined? ill defined? Not all Viability is an issue.  How to define and analyze NEED? Market analysis Background analysis  What is the effect if NEED is misinterpreted? Product failure to market

6. 5 Some example of NEED  A wheelchair that can go up and down the stairs  An air-conditioned shirt  Cooling/Exhaust fan for cars

7. 6 Perimeter of the Problem  User Analysis – Does the need exist? Who are the potential users? Physical attributes (age, gender, size, reach, visual angles, etc…) Physical work places (table height, sound levels, lighting, software version…) Perceptual abilities (hearing, vision, heat sensitivity…) Cognitive abilities (memory span, reading level, musical training, math…) Personality and social traits (likes, dislikes, preferences, patience…) Cultural and international diversity (languages, process flow, symbols…) Special populations, (dis)abilities

8. 7 Initial Processes  Recognition of Need “Identifying Opportunities” In Industry, often Marketing Department  Becoming Informed LEARN ABOUT THE PROBLEM! – background analysis Literature Searches Patent Searches Web Searches Talk with “experts” and “customers”

9. 8 Marketing Overview (Ref: Principles of Marketing by P. Kotler & G. Amstrong, Prentice Hall  Nature & core concepts of marketing  The marketing management process

10. 9 Misconceptions of Marketing  Marketer create needs, manipulate people to buy something they don't want  Marketing = selling = advertising  Marketing = shoes polishing  Customer will favour those products that offer the most quality, performance & innovative feature

11. 10 What is Marketing ?  A social & managerial process by which individuals & groups obtain what they need & want through creating & exchanging values with others  Marketing ( management ) is the process of planning & executing the production, pricing, promotion & distribution of ideas, goods & services to create exchange that satisfy individual & organizational goals. ( integrated marketing activities)

12. 11 Products Needs, wants, and demands Exchange, transactions, and relationships Markets Core Marketing Concepts Core Marketing Concepts Value, satisfaction, and quality Core Concepts

13. 12 Important elements of Marketing  Consumer behaviour  Market research  Segmentation  The 4 P’s

14. 13 Factory Existing Products Selling and Promoting Profits through Volume Market Customer Needs Integrated Marketing Profits through Satisfaction The Selling Concept The Marketing Concept Starting Point FocusMeansEnds Marketing & Sales Concept Contrasted

15. 14 Society (Human Welfare) Society (Human Welfare) Consumers (Satisfaction) Consumers (Satisfaction) Company (Profits) Company (Profits) Societal Marketing Concept Societal Marketing Concept The Societal Marketing Concept

16. 15 Managing the Marketing Plan & Planning Process

17. 16 Step 1: Refer to business mission Market Oriented Market Oriented Distinctive Competencies Distinctive Competencies Vision Realistic Motivating Specific Characteristics of Good Mission Statements Characteristics of Good Mission Statements

18. 17 Step2: Environmental Analysis  Macro & micro scan by market research on market, competitive, product situation  Identify opportunity & threat & match with strength & weakness  The world is getting smaller, different countries are at different stages of economic & technological development, customers have different need at different place

19. 18 Step 3: Marketing Goal/Objectives  Specific, quantitify, benchmark, realistic, time-frame, target, update e.g. customer a/c: increase usage from 30% to 80% i.e. 400,000 a/c form 96-97 corporate a/c: open up the mkt of those medium to large size companies in 6 months sales volume: increase by 120%. i.e.59 million minutes

20. 19 Step 4: Target Market Selection Demand Forecasting Demand Forecasting Market Segmentation (culture, geog, sex, age, income) Market Segmentation (culture, geog, sex, age, income) Market Targeting (which segments to attack?) Market Targeting (which segments to attack?) Market Positioning (product position in the mind of consumer) Market Positioning (product position in the mind of consumer)  Locate new opportunity  Position brand favorably

21. 20 Step 4: Target Market Selection  International marketing more difficult: quality & quantity of data decrease variables more: 228 nations, race, language, religious, customs, culture

22. 21 Target Customers Intended Positioning Product Price Promotion Place On Sale! Step 5: Developing the marketing mix

23. 22 Step 5 : Developing the Marketing Mix  Four Ps Product Price Place Promotion  Four Cs Customer needs & wants Cost to customer Convenience Communication  Synergy  Global approach/localised approach

24. 23  Step 6: Action program & budget  Step 7: Evaluation & control

25. 24 Executive Summary Current Marketing Situation Threats and Opportunities Objectives and Issues Marketing Strategy Action Programs Budgets Controls Marketing Plans

26. 25 Classic Product Life Cycle IntroductionGrowthMature Decline Profits Sales TIME $