1. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 1 Building a Guerrilla Marketing Plan

2. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 2 Marketing The process of creating and delivering desired goods and services to customers and involves all of the activities associated with winning and retaining loyal customers The process of creating and delivering desired goods and services to customers and involves all of the activities associated with winning and retaining loyal customers “Secrets” “Secrets”  Understand target customers’ needs, demands, and wants before competitors can  Offer them products and services to satisfy those needs, demands, and wants  Provide customers with quality, service, convenience, and value so they will keep coming back

3. A Winning Marketing Strategy Three vital resources: People - the most important ingredient in a successful marketing strategy People - the most important ingredient in a successful marketing strategy Information - the fuel that feeds the marketing engine; without it, the marketing engine sputters and stops Information - the fuel that feeds the marketing engine; without it, the marketing engine sputters and stops Technology - a powerful marketing weapon, but what matters most is how a company integrates technology into its overall marketing strategy Technology - a powerful marketing weapon, but what matters most is how a company integrates technology into its overall marketing strategy Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall Chapter 9: Guerrilla Marketing Plan 3

4. Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 4 A Guerrilla Marketing Plan Unconventional, low-cost, creative techniques that allow a company to wring a big “bang” from its marketing bucks Unconventional, low-cost, creative techniques that allow a company to wring a big “bang” from its marketing bucks Example: Jones Soda http://www.jonessoda.com/ Example: Jones Soda http://www.jonessoda.com/ http://www.jonessoda.com/

5. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 5 Four Objectives of a Guerrilla Marketing Plan Pinpoint the target markets a company will serve Pinpoint the target markets a company will serve Determine customer needs, wants, and characteristics through market research Determine customer needs, wants, and characteristics through market research Analyze a company’s competitive advantages and build a marketing strategy around them Analyze a company’s competitive advantages and build a marketing strategy around them Create a marketing mix that meets customer needs and wants Create a marketing mix that meets customer needs and wants

6. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 6 Pinpointing the Target Market First step: Identify the company's target market, the group of customers at whom the company aims its products or services First step: Identify the company's target market, the group of customers at whom the company aims its products or services An effective marketing program depends on a clear, concise definition of the firm's targeted customers, not a “one-size-fits-all approach” An effective marketing program depends on a clear, concise definition of the firm's targeted customers, not a “one-size-fits-all approach”

7. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 7 Pinpointing the Target Market Key: Understanding target customers’ unique needs, wants, and preferences Key: Understanding target customers’ unique needs, wants, and preferences Opportunity: Increasing populations of multicultural customers Opportunity: Increasing populations of multicultural customers

8. Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall

9. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 9 Pinpointing the Target Market Key: Understanding target customers’ unique needs, wants, and preferences Key: Understanding target customers’ unique needs, wants, and preferences Opportunity: Increasing populations of multicultural customers Opportunity: Increasing populations of multicultural customers Target customer must permeate the entire business Target customer must permeate the entire business

10. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 10 Market Research Market research - the vehicle for gathering the information that serves as the foundation for the marketing plan How to Conduct Market Research: Define the objective Define the objective Collect the data Collect the data

11. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 11 Collect the Data Individualized (one-to-one) marketing – a system of gathering data on individual customers and then developing a marketing plan designed specifically to appeal to their needs, tastes, and preferences Individualized (one-to-one) marketing – a system of gathering data on individual customers and then developing a marketing plan designed specifically to appeal to their needs, tastes, and preferences

12. How to Become an Effective One-to-One Marketer Identify your best customers, never passing up the opportunity to get their names. Collect information on these customers, linking their identities to their transactions. Calculate the long-term value of customers so you know which ones are most desirable (and most profitable). Successful One-to-One Marketing Know what your customers’ buying cycle is and time your marketing efforts to coincide with it - “just-in-time marketing.” Make sure your company’s product and service quality will astonish your customers. See customer complaints for what they are - a chance to improve your service and quality. Encourage complaints and then fix them! Enhance your products and services by giving customers information about them and how to use them. Source: Adapted from Susan Greco, “The Road to One- to-One Marketing,” Inc., October 1995, pp. 56-66.

13. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 13 Individualized (one-to-one) marketing – a system of gathering data on individual customers and then developing a marketing plan designed specifically to appeal to their needs, tastes, and preferences Individualized (one-to-one) marketing – a system of gathering data on individual customers and then developing a marketing plan designed specifically to appeal to their needs, tastes, and preferences Much valuable information about customers is already hidden inside companies; the key is mining it! Much valuable information about customers is already hidden inside companies; the key is mining it! Collect the Data

14. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 14 Data Mining A process in which computer software that uses statistical analysis, database technology, and artificial intelligence finds hidden patterns, trends, and connections in data so business owners can make better marketing decisions and predictions about customers’ behavior A process in which computer software that uses statistical analysis, database technology, and artificial intelligence finds hidden patterns, trends, and connections in data so business owners can make better marketing decisions and predictions about customers’ behavior Example: Henry Singer Fashion Group Example: Henry Singer Fashion Group

15. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 15 Market Research Analyze and interpret the data Analyze and interpret the data Put the information to work Put the information to work Market research is the vehicle for gathering the information that serves as the foundation for the marketing plan How to Conduct Market Research: Define the objective Define the objective Collect the data Collect the data

16. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 16 Relationship Marketing Involves developing, maintaining, and managing long-term relationships with customers so that they will keep coming back to make repeat purchases Involves developing, maintaining, and managing long-term relationships with customers so that they will keep coming back to make repeat purchases Steps: Steps:  Build database of customer information  Identify best and most profitable customers  Develop lasting relationships with these customers  Attract more customers like them

17. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 17 FISH! Principles 1. FISH Principle 1. Choose your attitude 2. FISH Principle 2. Play 3. FISH Principle 3. Make their day 4. FISH Principle 4. Be present

18. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 18 Guerrilla Marketing Principles Find a niche and fill it Find a niche and fill it Don’t just sell; entertain – “entertailing” Don’t just sell; entertain – “entertailing” Connect with customers on an emotional level Connect with customers on an emotional level Build a consistent branding strategy Build a consistent branding strategy

19. Building a Brand High Low LowHigh Differentiation Relevance “Antes” Features that are important to customers but all competitors provide them Every company in the market must “ante up” on these features. “Drivers” Features that are both important to customers and are highly differentiated from those of competitors These are the attributes on which a company must focus to build its brand. “Fool’s Gold” Features that are unique to your company but do not drive customers’ loyalty to your product and services Don’t make the mistake of trying to build a brand on these features! “Neutrals” Features that are irrelevant to customers These features are useless when it comes to branding. Source: Adapted from “What Really Matters in Building a Brand,” The McKinsey Quarterly, May 2004, www.mckinseyquarterly.com/newsletters/chartfocus/2004_05.htm

20. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 20 Guerrilla Marketing Principles Start a blog Start a blog Use social commerce Use social commerce Strive to be unique Strive to be unique Focus on the customer Focus on the customer

21. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 21 Focus on the Customer Customers are 5x more likely to leave because of poor service than for quality or price Customers are 5x more likely to leave because of poor service than for quality or price 94% of dissatisfied customers never complain about rude or discourteous service, but... 94% of dissatisfied customers never complain about rude or discourteous service, but...  91% will not buy from that business again  31% will tell others about their negative experience  48% have avoided a store because of someone else’s negative experience with it

22. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 22 How to Focus on the Customer When you create a dissatisfied customer, fix the problem fast When you create a dissatisfied customer, fix the problem fast Encourage customer complaints Encourage customer complaints Ask employees for feedback on improving customer service Ask employees for feedback on improving customer service Get total commitment to superior customer service from top managers - and allocate resources appropriately Get total commitment to superior customer service from top managers - and allocate resources appropriately

23. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 23 How to Focus on the Customer Allow managers to wait on customers occasionally Allow managers to wait on customers occasionally Develop a service theme that communicates your attitude toward customers Develop a service theme that communicates your attitude toward customers Reward employees “caught” providing exceptional service to customers Reward employees “caught” providing exceptional service to customers Carefully select and train everyone who will deal with customers Carefully select and train everyone who will deal with customers (Continued)

24. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 24 Guerrilla Marketing Principles Start a blog Start a blog Use social commerce Use social commerce Strive to be unique Strive to be unique Focus on the customer Focus on the customer Retain existing customers Retain existing customers

25. The High Cost of Lost Customers If you lose... Spending $5 weekly Spending $10 weekly Spending $50 weekly Spending $100 weekly Spending $200 weekly Spending $300 weekly 1 customer a day $ 94,900 $ 189,800 $ 949,000 $ 1,898,000 $ 3,796,000 $ 5,694,000 2 customers a day 189,800 379,600 1,898,000 3,796,000 7,592,000 11,388,000 5 customers a day 474,500 949,000 4,745,000 9,490,000 18,980,000 28,470,000 10 customers a day 949,000 1,898,000 9,490,000 18,980,000 37,960,000 56,940,000 20 customers a day 1,898,000 3,796,000 18,980,000 37,960,000 75,920,000 113,880,000 50 customers a day 4,745,000 9,490,000 47,450,000 94,900,000 189,800,000 284,700,000 100 customers a day 9,490,000 18,980,000 94,900,000 189,800,000 379,600,000 569,400,000 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall

26. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 26 About 70% of a company’s sales come from existing customers About 70% of a company’s sales come from existing customers Because 20% of a typical company’s customers account for about 80% of its sales, no business can afford to alienate its best and most profitable customers and survive! Because 20% of a typical company’s customers account for about 80% of its sales, no business can afford to alienate its best and most profitable customers and survive! Retain Existing Customers

27. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 27 Repeat customers spend 67 percent more than new customers Repeat customers spend 67 percent more than new customers Replacing lost customers is expensive; it costs 7 to 9 times as much to attract a new customer as it does to sell to an existing one! Replacing lost customers is expensive; it costs 7 to 9 times as much to attract a new customer as it does to sell to an existing one! Retain Existing Customers

28. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 28 Guerrilla Marketing Principles Start a blog Start a blog Use social commerce Use social commerce Strive to be unique Strive to be unique Focus on the customer Focus on the customer Retain existing customers Retain existing customers Devotion to quality Devotion to quality

29. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 29 Devotion to Quality World-class companies treat quality as a strategic objective, an integral part of the company culture World-class companies treat quality as a strategic objective, an integral part of the company culture Total Quality Management (TQM) - quality not just in the product or service itself, but in every aspect of the business and its relationship with the customer and continuous improvement in the quality delivered to customers Total Quality Management (TQM) - quality not just in the product or service itself, but in every aspect of the business and its relationship with the customer and continuous improvement in the quality delivered to customers

30. The Quality DMAIC Process Increased Return on Quality Investment D efine Define the problem. M easure Measure important outcomes. A nalyze Use statistical tools to find causes of quality problems. I mprove Make changes to the process and measure improvements. C ontrol Sustain quality improvements. Adapted from: Walter H. Ettinger, MD, “Six Sigma,” Trustee, September 2001. P. 14.

31. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 31 How Do Americans Define “Quality?” Reliability (average time between breakdowns) Reliability (average time between breakdowns) Durability (how long an item lasts) Durability (how long an item lasts) Ease of use Ease of use Known or trusted brand name Known or trusted brand name Low price Low price Quality

32. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 32 Quality Guidelines Build quality into the process; don’t rely on inspection to obtain quality Build quality into the process; don’t rely on inspection to obtain quality Emphasize simplicity in design Emphasize simplicity in design Foster teamwork Foster teamwork Establish long-term ties with select suppliers Establish long-term ties with select suppliers Provide managers and employees with the training needed to produce quality Provide managers and employees with the training needed to produce quality Empower workers at all levels of the organization Empower workers at all levels of the organization

33. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 33 Quality Guidelines Get managers’ commitment to the quality philosophy Get managers’ commitment to the quality philosophy Rethink the processes the company uses now. Is there a better way? Rethink the processes the company uses now. Is there a better way? Reward employees for quality work Reward employees for quality work Develop a company-wide strategy for continuous improvement of product and service quality Develop a company-wide strategy for continuous improvement of product and service quality (Continued)

34. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 34 Guerrilla Marketing Principles Attention to convenience Attention to convenience

35. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 35 Is your business conveniently located near customers? Is your business conveniently located near customers? Are your business hours suitable to your customers? Are your business hours suitable to your customers? Would customers appreciate pickup and delivery services? Would customers appreciate pickup and delivery services? Does your company make it easy for customers to buy on credit or with credit cards? Does your company make it easy for customers to buy on credit or with credit cards? Attention to Convenience

36. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 36 Attention to Convenience Are you using technology to enhance customer convenience? Are you using technology to enhance customer convenience? Are your employees trained to handle business transactions quickly, efficiently, and politely? Are your employees trained to handle business transactions quickly, efficiently, and politely? Do your employees use common courtesy when dealing with customers? Do your employees use common courtesy when dealing with customers?

37. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 37 Attention to Convenience Does your company offer “extras” to make customers’ lives easier? Does your company offer “extras” to make customers’ lives easier? Can you adapt existing products to make them more convenient for customers? Can you adapt existing products to make them more convenient for customers? Does your company handle telephone calls well? Does your company handle telephone calls well?

38. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 38 Guerrilla Marketing Principles Attention to convenience Attention to convenience Concentration on innovation Concentration on innovation

39. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 39 Concentration on Innovation Innovation - the key to future success Innovation - the key to future success Innovation - one of the greatest strengths of the entrepreneur, showing up in the new products, techniques, and unusual approaches they introduce Innovation - one of the greatest strengths of the entrepreneur, showing up in the new products, techniques, and unusual approaches they introduce

40. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 40 Concentration on Innovation Product Development and Management Association Study of top performing companies across 400 industries: New products accounted for 49% of profits, more than twice as much as their less innovative competitors Product Development and Management Association Study of top performing companies across 400 industries: New products accounted for 49% of profits, more than twice as much as their less innovative competitors

41. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 41 Stimulating Innovation Make innovation a priority in the company Make innovation a priority in the company Measure the company’s innovative ability Measure the company’s innovative ability Set goals and objectives for innovation Set goals and objectives for innovation Encourage new product or service ideas among employees Encourage new product or service ideas among employees Listen to customers Listen to customers Always be on the lookout for new product and service ideas Always be on the lookout for new product and service ideas Keep a steady stream of new products and services coming Keep a steady stream of new products and services coming

42. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 42 Guerrilla Marketing Principles Attention to convenience Attention to convenience Concentration on innovation Concentration on innovation Dedication to service and customer satisfaction Dedication to service and customer satisfaction

43. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 43 Goal: to achieve customer astonishment! How can you improve your service? Listen to customers Listen to customers Define “superior service” Define “superior service” Set standards and measure performance Set standards and measure performance Examine your company’s service cycle Examine your company’s service cycle Hire the right employees Hire the right employees Dedication to Service

44. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 44 Dedication to Service Train employees to deliver superior service Train employees to deliver superior service Empower employees to offer superior service Empower employees to offer superior service Use technology to provide improved service Use technology to provide improved service Reward superior service Reward superior service Get top managers' support Get top managers' support Give customers an unexpected surprise Give customers an unexpected surprise

45. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 45 Guerrilla Marketing Principles Attention to convenience Attention to convenience Concentration on innovation Concentration on innovation Dedication to service and customer satisfaction Dedication to service and customer satisfaction Emphasis on speed Emphasis on speed

46. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 46 Emphasis on Speed Three aspects of TCM - Time Compression Management: 1. Speeding new products to market 2. Shortening customer response time in manufacturing and delivery 3. Reducing the administrative time required to fill an order Companies using TCM have discovered that manufacturing takes only 5% - 10% of total lead time

47. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 47 Re-engineer the process rather than try to do the same things - only faster Re-engineer the process rather than try to do the same things - only faster Study every phase of the business process, looking for ways to shorten it Study every phase of the business process, looking for ways to shorten it Create cross-functional teams of workers and empower them to attack and solve problems Create cross-functional teams of workers and empower them to attack and solve problems Share information and ideas across the company Share information and ideas across the company Set aggressive goals for production and stick to the schedule Set aggressive goals for production and stick to the schedule Instill speed in the company culture Instill speed in the company culture Use technology to find shortcuts wherever possible Use technology to find shortcuts wherever possible Emphasis on Speed

48. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 48 With an attractive Web site, even the smallest companies can market their products and services around the globe With an attractive Web site, even the smallest companies can market their products and services around the globe The Web can be the “Great Equalizer” in a small company’s marketing strategy The Web can be the “Great Equalizer” in a small company’s marketing strategy Marketing on the World Wide Web

49. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 49 Marketing on the World Wide Web 2010: E-commerce accounts for 13% of total retail sales 2010: E-commerce accounts for 13% of total retail sales Do it right! Do it right!  Empirix study: 20% of online shoppers say that a negative online experience caused them to stop doing business – both online and offline – with a company

50. The Marketing Mix Product Place Price Promotion Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall

51. Stages in the Product Life Cycle Introductory stage Introductory stage High Costs Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall

52. Stages in the Product Life Cycle Introductory stage Introductory stage Growth and acceptance stage Growth and acceptance stage High Costs High Costs High Costs Sales Climb Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall

53. Stages in the Product Life Cycle Introductory stage Introductory stage Growth and acceptance stage Growth and acceptance stage Maturity and competition stage Maturity and competition stage High Costs Sales Climb Profits Peak High Costs Sales Climb Profits Peak Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall

54. Stages in the Product Life Cycle Introductory stage Introductory stage Growth and acceptance stage Growth and acceptance stage Maturity and competition stage Maturity and competition stage Market saturation stage Market saturation stage High Costs Sales Climb Profits Peak Sales Peak High Costs Sales Clim b Profits Peak Sales Peak Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall

55. Stages in the Product Life Cycle Introductory stage Introductory stage Growth and acceptance stage Growth and acceptance stage Maturity and competition stage Maturity and competition stage Market saturation stage Market saturation stage Product decline stage Product decline stage High Costs High Costs Profits Peak Profits Peak Sales Peak Sales Peak Sales & Profits Fall Sales & Profits Fall High Costs Sales Climb Profits Peak Sales Peak High Costs Sales Clim b Profits Peak Sales Peak Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall

56. Channels of Distribution Consumer Goods Manufacturer Consumer RetailerConsumer Manufacturer RetailerConsumer Wholesaler Manufacturer RetailerConsumer Wholesaler Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall

57. Channels of Distribution Industrial Goods Manufacturer Industrial User Manufacturer Wholesaler Industrial User Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall

58. Chapter 9: Guerrilla Marketing Plan Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 58 All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. Printed in the United States of America. Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall