2. BA (Hons) Business, Management & Communications Managing Marketing Activities Week 3

3. We are not bad people… https://www.youtube.com/watch?v=de50trNEvf8 Strategy or Tactics – or both ??

4. Today’s Session Learners will: Differentiate between strategy and tactics Be reminded of the 4P’s of marketing Be introduced to the additional P’s of marketing in terms of services marketing Understand how to integrate all elements of the marketing mix using an appropriate strategy to achieve business objectives.

5. Marketing Strategy and Marketing Tactics Strategy Long term direction Difficult to reverse Involves rejection of alternatives Where we want to be? Determined by senior managers/directors Overall balance of the marketing mix Tactics Short term impact Relatively easy to change Allows combination and testing of alternatives How we plan to get there? Agreed at operational level by budget holders Details of the mix relevant to each campaign

6. Assignment Requirement You are asked to undertake a marketing project that seeks to rebrand and reposition travel by bus to become the transport mode of choice within Oxfordshire. You will be rebranding Oxford Bus Company and should consider a specific target market (or markets) of your own selection. You will need to produce an individual marketing plan, which outlines the possible actions that could be taken. Various areas could be considered, but the following MUST be discussed: Assessment of market opportunities Selection of appropriate options Target market options Brand positioning DISCUSSION: Do these elements require you to take a strategic or a tactical approach – or both?

7. Marketing Strategies “A marketing strategy is the means by which an organisation sets out to achieve its marketing objective. The main areas of focus are the definition of the target market and the marketing mix employed”. [B&P, p1012] “Strategy is influenced by organisational objectives and resources, competitor activities, the structure of the market itself and the firm’s willingness to make changes and take risks”. [Blythe (2012), p235]

8. Strategic Management “Excellent” analysis and therefore strategic management does not involve viewing through one model or framework but using many to draw out multiple issues, challenges, criteria and concepts 1.Strategic analysis; (PESTLE, Porter’s 5 Forces, SWOT, PLC) 2.Strategic choice; (Porter’s Generic Strategies, Ansoff’s product-market strategies, BCG Matrix, PLC) 3.Implementation and evaluation.

9. The Marketing Mix Product – a bundle of benefits to met customers’ needs Price - generates revenue – often differentiates our product from competition - part of the overall product offer and perception Place – location where the exchange takes place – includes distribution channels Promotion – range of tools to communicate the offer to customers The Extended Marketing Mix also includes: People – front line staff who deliver the service Processes – systems used to deliver product benefits Physical evidence – tangible aspects of service delivery – something which the customer can keep as a memento

10. What is a Product? [B&P Chpt 7; Blythe Chpt 6] A physical “thing” or a Service which offers a total package (or “bundle”) of benefits – physical, functional and symbolic Tangible and Intangible attributes Levels of a Product (B&P p289) 1. Actual/basic/Core product 2. Tangible product 3. Augmented product 4. Potential product

11. What are the missing product levels? In groups, complete this table Share the table with the rest of the group 10 minutes End Brand, product or service Actual/Core ProductTangible Product (putting flesh on the core) Augmented Product (add ons) Potential Product (Doyle 1998) Mazda Car Black shiny paintwork Freedom to travel Caribbean holiday A holidayHoliday insurance Manchester United Football Club Sporting event Excitement, entertainment and leisure Nike Logo Nike online allows personalisation of trainers Wyevale Garden Centres Products for gardensWyevale’s Gardening Club

12. Discussion What is our core product? What forms our tangible product? What is/are our augmented product/s? What is our potential product?

13. Product Life Cycle Introduction - early promotion & development costs lead to negative profits Growth - sales rise and profits reach a peak, then start to decline with competition Maturity - sales peak; price cuts lead to decline in profits Decline - sales fall rapidly; time to phase out the product

14. Limitations of the PLC Some products have regular revivals Many new products don’t even reach 1 st base Failed products can reappear in a new market Difficult to predict when a product will reach its maturity – and how long that phase will last The decline phase can go on … and on … (for example Fairy Soap – first introduced in 1898) http://www.lifebuoy.co.uk/fairy-household-soap.htm Where is Oxford Bus Company on the PLC?

15. The Industry Life Cycle Where is bus travel on the industry life cycle?

16. Classifies products (or brands) on the basis of their market share and their rate of growth in the market Question Mark (Problem Child) – small market share in a high growth industry [one hit wonders] Star – high market share in high growth industry [iPhone] Cash Cow – high market share in a mature slow-growth market [eg the Self-storage industry] Dog – low market share in a low growth market [shoe polish ] The Boston Matrix [B&P p945]

17. The Industry Life Cycle & BCG

18. Ansoff’s Growth Matrix Strategies you may want to adopt if the priority is growth Penetration – increase in current markets Product Development – existing markets, but new products Market Development – Selling existing to new markets Diversification – new products and new markets

19. Why do we need New Product Development (NPD)? Changing customer needs To match our competitors Technological changes and other threats To extend/refresh the product range To extend the “maturity” stage of PLC Long-term business strategies Do/could Oxford Bus Company have a NPD strategy?

20. PRICE in the Mix [B&P Chpt 10, Blythe (5 th ed) Chpt 7] Price affects each of the other elements of the Mix Influences profitability at the “top line” by generating revenue – price can boost sales temporarily Differentiates your products from the rest – how do we want to be seen in the marketplace? Part of the overall product “offer” – but price must be consistent with the other elements of the marketing mix in the mind of the customer Price sensitivity – do we know what reaction we will get from our customers from an increase or decrease in price? Who is in charge of Price?

21. External influences on pricing decisions [Strategy v Tactics] Customers (and their ability to pay) Legal & regulatory requirements & costs Channels of distribution (getting to market) Demand and price elasticity Competitors strategic approach to pricing

22. PLACE - Channels and Logistics [B&P, p534; Blythe, Chpt 8] Choose the correct channels for your product or service Strategic decision based on the target market and the type of product and “just in time” delivery Brand qualities and the use of Intermediaries may also influence the channels you use Physical distribution - transporting products to the right locations Tactical decisions involving type of transport, storage Market conditions and infrastructure dictate logistics – eg getting fresh products to your customers

23. PLACE and the buses What considerations do we need to make in terms of place with bus travel?

24. PROMOTION: The basic Promotional Mix (Blythe, (2012) p195 + B&P (2006) p630) The total marketing communications programme Sometimes referred to as marcoms – eg: in job ads Use a variety of tools, blended for your market The choice of tools, methods & media continues to grow

25. The FIVE main tools of integrated marketing communications 1.Advertising – the paid insertion of a message in a medium – there is no such thing as FREE 2.Public Relations – Activities create a positive image of your organisation and its brands 3.Personal Selling – expensive but helps identify how to solve your customers’ problems 4.Sales Promotion – short term boost to sales (at the expense of your competitors!) 5.Direct Marketing (Direct Response Advertising) – creates and develops a direct relationship between the consumer and the company on an individual basis – helps measure impact of marketing spend

26. The Purposes of Advertising Why do brands and organisations choose to “advertise” …. To promote sales To create an image or to promote an idea To support personal selling To offset competitor advertising To remind, reassure and reinforce their brand

27. Choice of Advertising Media Televison – national, local, multi-channel Cinema – target young consumers and well off, better educated entertainment seekers Billboards – local campaigns in key locations Press – mass media, specialist and trade magazines, local free sheets, weeklies Web advertising – pop ups, banners, links Where could you advertise the bus company?

28. “Public Relations is …. …the deliberate, planned and sustained effort to institute and maintain mutual understanding between an organisation and its publics”. [B&P p876]

29. The Basic Publics [B&P p876] A group with which an organisation needs to communicate. Each group poses different communication problems, has different information needs and different relationships General (community, pressure groups) Financial (shareholders, investors) Media Internal Authority (Government, trade associations, regulatory bodies) Commercial (customers, suppliers, competitors)

30. Personal Selling (Sales force - roles & activity) Prospecting, selling, communicating (PUSH), servicing, information gathering, allocating stock and Point of Sale items (PULL) Marcoms team can support personal sales with advertising, thus generating “leads”; can design and print information literature; can produce & segment customer data – all to make the sales force more effective

31. Sales Promotion Intended to increase short-term sales Adds “extra” value to the product or service Techniques include – Price Promotions, Premium Promotions, Competitions and Prizes, Loyalty or frequent user Incentives, Trade Promotions Don't confuse Sales Promotion with promotion

32. Direct Marketing Direct mail including E-mail Text messaging (SMS) Direct Response Advertising & DRTV Mail Order, Catalogues and “specialogues” Call Centres and tele-marketing – in- bound and out-bound

33. Any other promotional ideas? Sponsorship Point of Sale Exhibitions Universities?

34. New Media Tools What digital communication tools might be appropriate to help boost usage of the Oxford Bus Company? Text messaging Mobile Entertainment QR codes Viral marketing

35. The last 3 Ps – the service sector [B&P, p1063] People – their appearance, attitude and skills. A manager’s role is to recruit only the best people, train and empower them to constantly deliver exceptional customer service

36. The last 3 Ps – the service sector [B&P, p1063] Process – of information to the customer; Queue management; policies and performance; speed of service; data flows

37. The last 3 Ps – the service sector [B&P, p1063] Physical evidence – “a tangible proof of purchase than reminds your customer of a magical moment”, ambience, livery, uniforms

38. Services Marketing – the differences from Product marketing [Blythe, p261] Inseparability of product from consumption - a candle- lit dinner for two [both happen at the same time Intangibility – services cannot be touched – hence the need for physical evidence Variability – there may be differences from day to day – the car wash may not get all the dirt off Perishability - services cannot be stock piled – once an aircraft takes off the unsold seats remain unsold Non-ownership – the customer cannot own the services they receive – there is no 2 nd hand value

39. Marketing Strategy and Marketing Tactics Strategy Long term direction Difficult to reverse Involves rejection of alternatives Where we want to be? Determined by senior managers/directors Overall balance of the marketing mix Tactics Short term impact Relatively easy to change Allows combination and testing of alternatives How we plan to get there? Agreed at operational level by budget holders Details of the mix relevant to each campaign

40. Putting it all together You will need to assemble (and Integrate) all the elements of the marketing mix in order to make sensible recommendations for fixing problems, coping with external influences or responding to changing customer needs https://www.youtube.com/watch?v=qTGY99uZTsshttps://www.youtube.com/watch?v=qTGY99uZTss You will need to co-ordinate the use of the 4P’s (7 within services) in the correct proportions at the correct time to match with your brand personality and the needs of your customers + your company You will need to measure (evaluate) the success of your marketing strategy & tactics