La prima lezione di Strategic and Digital Marketing
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La prima lezione di Strategic and Digital Marketing

welcome to the strategic and digital
marketing course within the bachelor’s degree in digital management that the
CAF Oscar University of Venice launched in the age farm campus in cooperation
with H farm itself my name is Leonardo booth Tsavo I am associate professor at
the Department of Management University of Venice and I will be your teacher for
this course with your help hopefully over the next weeks we’ll try to work
and understand better what marketing is the way in which marketing can add value
within an organization and company the way in which you can help us as
decision-makers improve the consistency between choices we take in the market we
are targeting so that we can improve our business we can improve profits and if
you’re not working in a profit driven company maybe you’re working in a
not-for-profit environment marketing would still be useful in order to
optimize the way in which you work so over these weeks we’ll try to get
familiar with marketing we try to get some language that is commonly used
within companies we’ll try to understand a set of
knowledge and concepts but also a set of skills and techniques and tools that we
can use in our life and hopefully if marketing would be a daily part of your
life you’ll be able to use those as much as you can so strategic and digital
marketing I mean why strategic why strategic and
we call this course strategic because we will not just talk about marketing in a
tactical way you can have a course that is actually adopting a very tactical
approach you know operational marketing tactical marketing tools and tools this
might be good but then it doesn’t give you a broader vision so we like to think
that you need a strategy so you need to look at this in a broader way and why do
we need a strategy when you just do not have to worry about today or next week
but you need to adopt a long a time frame and typically in a company you
need to adopt a longer time frame you have resources involved in your
choice you need a strategy because you’re investing money or invest in time
you need to fine-tune your decision and also because when you take decisions
sometimes they are not easily reversible it’s not easily to say I’m just gonna go
back when we dress up in the morning we look ourselves in the mirror and say
maybe I’m gonna change my jacket it takes a couple of minutes but if you
take a decision in a company about let’s say developing a product or launching a
marketing campaign is not that quick and not that cheap to go back so that’s why
strategy is important and we’re gonna go back to this and why digital well one of
the reasons is because this is a bachelor’s degree in digital management
but and why is this because digital has been transforming our lives but it’s
been transforming the way in which companies operate and for so many years
we heard about this offline and online like these things at two different
worlds but more and more we’ve seen the convergence of this so the blend of
offline and online is very difficult now to see a division so companies and as
all companies marketing has to make a bridge between these worlds because we
as consumers are constantly interacting with physical and digital based contents
when we shop for products when we look at advertising when we decide to buy or
not buy when we provide an evaluation about a product or about an experience
that’s gonna go on a website and we can share that with other people and this
builds up and becomes information that will orient other people’s decisions so
more and more what we are seeing inside companies is that we’re moving away from
companies having a digital department and more and more they’re becoming
digital companies so the digital dimension is investing the whole company
and this is the same for marketing you know we’re not just gonna have digital
marketing as a small piece of marketing but digital is investing the whole of
marketing is changing the rules of marketing and it’s allowing us to enter
a new world so that’s why strategic that’s why digital and now marketing of
course is the Bill block of this course now marketing
sometimes you know in popular wisdom it’s some sort of a Cinderella you know
a lot of people common people people that I they’re not involved in marketing
people that are not actually study marketing they think that a lot of
things are marketing maybe just they they see that you dressed well and they
say how you’re doing marketing of yourself or maybe they’re watching a
television ad and they say that’s marketing okay that’s a very simple way
and what we’re trying to do to understand the complexity of marketing
the traditional marketing marketing is almost a century old in terms of a body
of knowledge in terms of our discipline that became an academic discipline has
been taught in academic universities and in courses all over the world
and over time marketing has become more and more data-driven has become more of
a science so prepare for a world in which marketing is less of an art in
terms of going by intuition and approximation and more and more driven
by data driven by a scientific approach in which we’re trying to refine our
knowledge very precisely more and more working in companies you’ll be asked to
use data and merge the data with your choices I’m not saying that instinct is
not going to be important I’m not saying that intuition is not important but you
need to complement that with the hard part of data and a lot of studies are
telling us that machine learning artificial intelligence the wisdom of
the machines will impact on our lives and reshaping our labor in the sense
that they they can do things that were done by marketing people in the
departments so study is doing that half of the marketing jobs we will replace by
machine intelligence now is that meaning that there will be less marketing for
humans in the future no it will mean that marketing will be refocused more
and more things will be done with the machines and has humans we have a
responsibility to do more of the high value-added work
to create new connections and make new decisions so this is not the the end of
marketing is actually a restructuring of marketing the way we gonna leave it so
what is marketing by the way marketing is is a set of concepts is a set of
tools is a set of techniques that are helping us to relate to a market so
market Inc we need to fine-tune a relationship to a market and it is about
creating better value for a market so that we can take that value back to us
again what does it mean in in economics it’s about value every time we as
consumers we decide that we attribute value to something we’re prepared to pay
some money and that money is the value that we give up because we could use
that money for something else so basically if we are improving the way in
which we create value our product the service that we provide the experience
that we’re gonna provide then this will impact better and we’ll be able to
transfer that value back to the company it’s about value creation and about
value appropriation now this is a long road it’s a complicated route because
implies devising a lot of elements making them consistent along the way but
this is what marketing is about and why is this this is the case because we all
have needs I mean as human beings we need to eat we need to drink
we need to shelter ourselves from the rain and the cold we need to do a
variety of things we have a lot of needs as human beings but thanks to our up
psychology to our society it work culture some things are becoming
actually more evolved and they become once we probably do not need an
expensive watch I mean we could just need a way to tell our time we can maybe
move with a cheap car maybe we want to buy an expensive car so they become once
when they are shaped by our psychology and now with social media a lot of
people are actually changing their desires and wants into
more expensive things because they’re seeing this around posted by other
people now this becomes demand when it is backed by buying power so demand is
when this needs and wants are backed by buying power it means that there are
some money behind you know imagine if we’re all watching a luxury product but
we don’t have a neuro to spend so we have a want or we want to buy that
expensive car but we don’t have a neuro to spend this is not becoming demand so
marketing then hopefully we’ll need to find you in decisions so that it targets
consumers that can activate buying power it can become demand daddy man becomes
sales it becomes business and then hopefully it will become prophets so
just think of an example when it’s gonna be cold
we need to shelter ourselves because we don’t go out with the t-shirt we need a
coat and and then maybe you buy a type of coat think of a brand like save the
duck save the duck has chosen to save the animals basically what save the duck
is saying say I’m different from Montclair Montclair will sell you an
expensive protection from the cold but I will tell you a protection from the cold
that is actually using artificial material so no ducks will be harmed so
again what am i buying here now I remember before when I said the needs
and the ones we all need to shelter from the cold but maybe we don’t wake up and
say oh I want to protect the animals or maybe duck feathers are okay so this is
where the psychology comes into the game and this is where we need to train our
thinking that every time we as consumers buy something we’re buying more than a
product we’re buying sometimes a story we’re buying an experience and in fact
you need to think about offerings so sometimes we think of a product but it
might be just the tangible part of it but the product sometimes includes a
service element it includes brand sometimes we’ve a set of a story maybe
with the founder and some of the advert includes an experience that maybe you
have because you’re buying that product and maybe you join in a community you
get in type of customized communications but it also includes ideas because today
companies are more and more broadcasting their ideas their ideas about society
there are be as their ideas about the planet so this becomes a very
complicated set of elements that are making products more evolved products
more multi related and and in decisions is very delicate to manage it all this
so an offering is a combination every time marketing people think of a product
they will combine tangible intangible elements cultural aspects service
elements and all this is is becoming more and more complicated
it’s becoming a combination of choices and what I would like to do over the
next weeks with you is actually to train you to think more about the power of the
combinations I would like you to think more in your customer experiences when
you buy products when you go around to see how many things are interconnected
behind that and how many things companies are dealing with when you’re
taking these decisions so again powerful combinations some brands some products
are very rich with history they are rich with DNA they are rich with heritage so
they are actually selling a product in which most of the value is actually in
the story you could calculate and say but but the actual cost of this bag of
this pours of this sofa of this watch is actually less than the money I paid but
a lot of the value is actually in the what was behind in the in the background
but again think about what I said before about needs and wants
think of TOMS shoes when you buy a pair of TOMS shoes they’re rather cheap you
can buy them but Thomas is actually telling you something I don’t just give
you a pair of shoes I will give a pair of shoes to a child in need so what
happens here I’m buying shoes I’m buying shoes
at the same time I am buying a little bit of feeling well because I will know
that the pair of shoes will be given to a poor child and maybe it’s good for me
because I wouldn’t know where to find the poor child and buy him a pair of
shoes so companies are actually selling ideas they are selling concrete actions
and they are being more and more required to be authentic to be
consistent because now with social media if a company is saying it’s gonna do
this and then it doesn’t it will be a problem in social media now there is
more awareness among the public so they need to be true what they do and
communication when we go back to communication is more and more required
to be authentic because more and more companies now are competing on social
purpose and somebody is actually arguing whether the concept of marketing will be
evolving into a concept of society because in a sense that more and more
companies are realizing that it’s not just about identifying a market selling
a lot of things or making a lot of money but it’s actually caring about society
consumers are immersed in society companies are required to pay more
attention to environmental goods now just to give you an example there is a
movie documentaries called the true cost this is actually showing the dark side
of the success of low-cost and fast fashion so we are all familiar with fast
fashion and all the big success in allowed more and more people to have
access to to to cheaper fashion and buy more clothing etc but this is just an
example of a movie that is trying to make you aware of how this is creating
complications because very cheap piece of clothing will drive down production
costs in a way that some people would be sort of reduced to poverty in order to
to produce a t-shirt and we buy too many because if a t-shirt is too cheap
maybe we just buy too many that we don’t need and so this create overconsumption
so this is a complicated thing but it’s just to keep you aware of the social
aspect of business remember that every time we think of
marketing we need to be aware that we need to keep in mind what the customer
wants now levied many decades ago introduced the concept of marketing
myopia using the story of drills so imagine that you need to put something
on the wall so you need to drill the wall and then you go to a store and
normally you’re looking for a drill I say hey I need a 1/4 inch drill and the
store and maybe the salespeople and the company will say hmm the customer needs
a quarter inch drill but the point is that the customer needs a quarter inch
hole it doesn’t need a drill the drill is only a way to get the hole and you
could say what is the story leading to it is leading to the difference between
what the customer actually wants and what actually companies are giving so
it’s important for you to think about end customer to think about end customer
usage and that is why today market research is becoming more and more
something based on cultural anthropology not just on numbers it’s based upon
understanding the customer experience understanding the ways in which the
customers are using the product and the way in which you can I can improve that
and a very common theme in marketing today let’s say tomorrow you start your
internship you start your job in a company in marketing and the very common
theme these days is the customer experience so we’re not just simply
worrying about making a great product or maybe including a good service or having
a nice brand and communicating that well but we are thinking about the total
customer experience around our product what happened before the purchase during
the purchase after and also when customers are in touch with other people
talking about the product so I always love to think back of what this American
lady put said a few years ago the people was actually people
well forget we normally forget things you know and we use people we forget
things you did you know they can forget things you said but you never forget
are you are you fail so this is the same for brands and companies you know
companies may be doing things for you they might be saying things for you but
it’s how they made you feel that creates that that important value so this is
very important when you think of customer experience for company so I
said before the marketing is almost a century all the age because he evolved
and actually he accompanied an evolution of industries where industry started in
in in in back in time they were concerned about producing things and the
production think of the birth of the mass production system it was important
to be invented to produce as many as possible that may be as fast as possible
and then over time we started paying more attention to the product and then
the importance of selling the product and then to the marketing set of
decisions that we’ll be investigating and then as I said before to society so
over time we’re seeing more and more of a shift from the inside of the company
to the outside and to the connections so now you hear a lot about co-creation
because a lot of things are actually co-created between the company and the
customer think about TripAdvisor and all the customer reviews think about
targeted advertising and Facebook because they targeted advertising that
Facebook is selling to the companies is actually fueled but all the information
that are fed through the way in which you post and like things it’s allowing
Facebook to direct advertising messages to companies so more and more
co-creation more and more relationships so just a
few things before providing you with more details of how some elements are
becoming more and more important in the marketing domain you’re more likely to
hear about customer relationship management you’re you’re seeing
companies more concerned in how to manage a
relationship with a customer over time you see more and more companies that are
trying to measure customer value because it’s very expensive to get to customers
it’s very expensive to do promotion as we will see so it’s very important to
measure what is the value of that customer compared to this customer how
much money should I be prepared to invest in that direction compared to
that direction it is an age of scarce resources we need to improve our ability
to do so a lot of attention to customer
satisfaction are my customers satisfied in a lot of surveys some companies are
actually producing service on how many customers are satisfied this is feeding
back information to companies improving their ability to be creating an extract
in value so selecting we will look at the segmentation we will look at
positioning marketing is about making choices you cannot do anything you need
to choose like you chose digital management in the wide array of our
bachelor programs it’s the same for a company when you need to target segments
you cannot do anything so you need to make choices and the relationships will
be more and more two-way because of this power given by digital technologies and
the ability positive and sometimes negative to make relationships in
two-way and the interesting thing will come back to this in a few in a few
minutes but consumer generated marketing so in the past marketing was more
created in the laboratory by the experts and then he was sent into the market now
actually the power of technology has given people like us the ability to
express thoughts and feelings share them and we’ve are like we can virally put a
message up in the in the videos in the screens of a lot of people so this means
that a company cannot control its reputation cannot control its brand like
it did in the past it’s more in the hands of customers you can try to do its
best but then a lot is being done by
customers so customers sometimes can do a positive reinforcement but they can do
a negative reinforcement if things go bad if something is being discovered
about this so this is very interesting the consumer generated marketing
marketing more in the hands of customers so how do we capture value we as
marketers we’re trying to build loyalty we would like our customers to be loyal
and buy a product again and again because this is giving us a stream of
money and so we need to create loyalty you can call it retention I would like
these companies to stay with me and again you remember when I said about
data-driven marketing more and more companies are are calculating the
customer lifetime value see when you go to a supermarket maybe they want you to
to make the card or maybe they want you to download the app what they’re doing
they’re trying to measure say how often are you shopping how much money are you
spending for how long you will be a customer maybe you’re just student here
for three years and then you go back to your region or home country but again
all these numbers they add up and they make some sort of a value represent and
it goes back to the selection where do I buy communication which one do I want to
target again it’s about selection is about consistency and what we speak
about the marketing mix and as like a DJ it is to pray play the right music for
the right type of people otherwise the dance floor will be empty everybody will
leave it means for the company no money is being paid so we want to build a
share of customer some people call about the share of wallet
you know I am selling something to you I want to sell you more things maybe you
have a TV subscription and they call it and they want to sell you the internet
subscription or maybe you have the internet subscription they call it they
wanna sell you electrical power again companies are increasing their share of
wallet he’s not very distant from when you go to a movie and I want to sell you
the popcorns and the drinks and maybe the special edition glass Wow 10 euros
for that you know but and go with a kid you know you have to buy that for 10 you
so that’s the share of wallet and companies are actually trying to get
this work on that in order to possibly make money if if it is a business case
then that’s what we’re trying to do then ideally this money will be used in a
virtuous way it will be used to improve the product to innovate and sometimes
maybe also to support the environment like everything things can be used in a
good and a wrong way marketing can be a very powerful – tool it can also
sometimes be criticized because you create unnecessary needs and wants or it
pushes marketers sometimes to invent stories in order to convince people
again there is the positive and the negative side will try to balance this
how is the landscape changing well some topics that we will not go through into
them because this is a course that we need to also strike decisions but more
and more around yourselves you will hear about a trend of frugality some
customers are cutting down on expenses they want to consume less energy they
want to buy maybe less meat they want to pollute less so there is a trend which
is actually emerging and sometimes is worrying marketers in some way because
you need to rethink your customers this this has element of social
responsibility I mentioned that before of course globalization now this
creating new competitors arriving and also the not-for-profit there is a
growing tendency of people actually starting not-for-profit businesses there
is a big trend for example around this and and that would be another another
trend for you in the future that’s why I told you before do not think of
marketing just as a tool for profit driven businesses and then of course
digital and this is something that we will dedicate a little bit of an extra
attention later on so marketing strategy I said before we will try to worry about
strategy not just about the tactical element and keep in mind that if you
haven’t already said that very clear in your brain that strategy in companies
moves different levels you have a corporate
level which is a very high level where the company is actually saying what am i
doing what is my mission what is my reason of being am i operating in this
business or the other and actually this is related to setting my goals do I want
to grow and how much any in which markets what will be my portfolio how
many businesses will be inside my portfolio and then of course there is
the business level so the business level would be related to the specific choices
around a given business think of companies around you sometimes and you
notice that they can sell more than one product so there might be different
businesses where you need to take the decisions so that’s where marketing in
particular becomes a key element to make these choices consistent and
particularly generating return of information normally we see the
boomerang in a negative sense we say oh this is a boomerang this didn’t work
well I like to think of a boomerang as something that we need to have more
because you see marketing over time and traditionally was sort of considered an
area where you could not measure much but more and more now the challenge is
to produce measurement data driven marketing Martic marketing technology
and this is a trend where you will be required to create mechanism to feedback
data to you there is a need to get this feeding back of information so this is
the way in which you can calibrate your strategy
you remember school you’re still in school but this is a university but in
the old times you had for example the geometry problem there was one solution
and you had to find that specific solution otherwise the grade was wrong
now marketing is not like that there is not a perfect solution we will make
mistakes just think about setting a price you can only get it wrong but the
trick is to keep on learning and to make less mistakes than your competitor
so in marketing everything will look be looking at the marketing mix all the
decisions were going to take they are very complicated there is not that
mathematical precise formula to get to the right solution we just need to make
less mistakes than our competitors and learn more quickly how to refine our
approach so that we keep our mistakes reducing and improving so that’s very
important so I said at the corporate level is about defining a mission so the
strategic origin of the marketing thing is when a company decides what’s going
to do think of the Disney Company if you go and read the mission of the Disney
Company you will find a statement that actually says what is going to do and
people could think of movies people can think of you know stuff the teddy bears
I think people can think of maybe a theme park but if you look inside the
Disney mission and my message to you when when maybe if a company you’re
familiar go on the website look mission statement read it out and if you do it
for bid for Disney they say we want to develop the most creative innovative and
profitable entertainment experiences you see they think of experiences if you
talk to a manager from a theme park you know what they you know what they say
that they produce memories it’s fascinating right say ok you you’re a
theme park like like Disneyland Orlando or disel and Paris they produce memories
they want to create memories because people would pay for memories and then
we actually pay a big ticket so people would actually pay a lot because there
is a story behind so if the mission is to create experiences then I can do this
in many ways I can do it with movies I can do it with the theme parks I can do
it with the products in the store and sometimes you pick up something made the
plastic and you say did I pay twenty nine euros for this but you actually
connected that maybe it were my memory of your childhood and then you bind
something that goes beyond that plastic element isn’t it
think of the coca-cola company I say okay what is coca-cola doing soft
drinks well actually look at the mission yes they want to refresh the world it
means that they provide refreshments drinks yeah soft drink this is typical
but look at this inspire moments of optimism happiness so this is actually
important because it reminds ourselves that when we drink a coca-cola when you
buy a coca-cola you actually buy in a little bit of the American style
optimist a little bit of happiness so that’s why even a similar soft drink
with the same taste without that logo will not drive you to spend that money
again that’s you know things that are helping us to think just look at
Facebook a young company a very smart company somebody has actually decided
that you can make money by selling targeted advertising and your workers
are you people that for free are posting sharing clicking liking and this is
actually generating for free a lot of value that was very smart by the way by
Facebook take a look at the mission they say people use Facebook to stay
connected the network to discover what’s going on the news and to share and
express what matters you know the sharing the liking and
whatever so all these creates a platform where that this is actually working in a
way where a lot of value is being created as I said besides the technology
platform by you by the content generators and then appropriated by the
company in terms of extracting value from the companies they want to send
targeted messages to you so we’re going to go back to strategy marketing
strategy but just to give you an example there are so many alternatives around
now this is what you can call the product market grid or matrix you can
call it the way you like but it’s actually showing to you that you can
have a product in a market and then you can move by for example taking that
product to a new market imagine that you’re selling energy
drinks I don’t know how many energy drinks you’re consuming a students I
mean that may be your own knowledge but you selling energy drinks in a market
and you decide you want to take that same energy drink to a different market
can be a new geographic market it can be a new demographic market maybe you
realize that even let’s say older people are prepared if you stimulate them to
consume energy drinks but you can actually think differently you say why
don’t I work in this existing market and I develop maybe a new product you are
ready in the market of energy drinks so you already have a relationship with
people that are actually buying energy drinks maybe sometimes they’re
practicing sports they’re very active why didn’t I sell them snacks why don’t
I a new product and again I aim at the sheer wallet or you can do these things
combined again there is no mathematical formula to know what’s best the thing is
to do exercises and simulations evaluation studies that are helping us
decide whether we want to try this or not so in practice if you want to try to
boil down what marketing is in your daily life in a company you might become
a marketing manager or you might become somebody joining a team and doing
analysis but if you boil it down it’s about a set of things one is the
segmentation segmentation means cutting the market in with with sets of
variables and deciding what you want to target and what you don’t want to target
remember that we as members of the society were naturally differentiated
you know we’re differentiated by gender by age by physical features where we
live maybe a disposable income this is natural okay this is existing as we
speak also our preference of color is there now remember that segmentation is
what a company does is what a marketing person or a marketing team does so
differentiation is natural is existing I want to buy a new table for my for my
living room I prefer would I prefer metal I prefer
this type of material this is natural differentiation segmentation is whether
is when a company decides to create a segment and where it wants to go
do I need older people younger people do I need to have a product for people
living in Italy or also in other markets do I need to worry about very active
people or very lazy people you know that’s segmentation so that’s the
analysis and that’s creating segments and decide that you want to go for that
segment and don’t go because it’s expensive to reach people it’s expensive
to do things you need to be consistent so when you’ve done the segmentation
then you start targeting and selecting so you created the analysis and that’s
where the game starts I’m gonna target segment a segment F saying that K in my
analysis I’m not gonna target the others and the reason why I decided they are
good for me they’re good for what I do they relate to my mission the
opportunity to create value and then I will do the position positioning means
when you step in and the targeting becomes a set of choices and actions on
how the product is shaped the packaging in which stores I’m gonna sell it what
type of messages I’m gonna send around what price and when I think of position
remember its position versus the competition you know every time you have
a product around you same how he relates to other why did I buy this product
versus the others was it the price was a combination of
things and elements I like the brand the features he has and remember that the
positioning is not in your mind it’s in the customers mind and that’s very
important in marketing because the customer will decide whether it’ll be
pain or not if you remember back in the in your economics courses if you
remember what is willingness to pay willingness to pay is the amount of
money that somebody’s prepared to give for something think of the water maybe
for a bottle of water we can say this is half a euro but if you’re very thirsty
coming from three days of walk in the desert maybe you can buy this for a
thousand euros or more because you’re risk
to die so that’s the willingness to pay so the good thing is when companies are
actually using the analysis and extracting your willingness to pay as
much as they can so that’s where the magic comes in in business and one that
that’s when the companies are making a lot of money so segmentation is about
we’re in classes that are doing an analysis that will become targeting and
positioning a remember segmentation does not exist in nature segmentation is part
of the marketing activity and a good precondition for a good marketing
strategy would be a good segmentation so you need skills you need experience you
need techniques you need to blend things and that is the product of your activity
some segmentations will be better than others and then they will end up and
they will show you opportunities think of what Starbucks does with the coffee
right people normally would say okay you want the coffee you want to decaf and
then Starbucks another play you started saying okay you want a short medium long
infusion syrup whatever you know that’s that’s a big choice of expanding why
because you realize there are more and more people prepare to pay for something
different a maybe with a little bit of experience around that so customers will
differ you need to create segments and understand where you want to go and you
need to ideally think of personas if you’re going to be working in marketing
you will hear this concept very often personas the persona is a is a
representation of of a type of individual that acts in similar ways
think in similar ways so you try to build personas and so they will help you
to make decisions now think of a city like Las Vegas a city lies like Las
Vegas did that tremendous marketing over the years and they increase the
population increase the businesses increase the revenues because it was
able to actually serve different type of customers you can have customers that
are actually going to gamble you know they want to go and gamble that’s what
they want to pay for and then they spend a lot of money
at the roulette table or the blackjack or whatever there might be actually
people there just like the entertainment they want to go and listen to the last
pierced all night and paying hundreds of dollars to get the table in front they
want to party they want to party that that’s the different segments and you
need to create a different value proposition and then there are people
they just want to go and and celebrate they want to get married in Las Vegas
they want to do their wedding anniversary they want to celebrate
whatever or think of a pipe or a popular movie like The Hangover they just want
to do maybe a celebration just before somebody’s getting married a different
type of segment and think of the business people
Las Vegas created a lot of congresses and more and more exhibitions and
congresses because he attracts the businessman so you think of different
segments and and of course they can overlap because you can have a business
plan go in there and maybe enjoying the entertainment you can have people going
to celebrate and then also maybe going to gamble but if you identify this type
of people this type of segments then you can fine-tune your offer you can find
you in your communication and possibly improve that so that’s when you need to
start thinking about the marketing mix a lot of time that will be spent over this
course is to understand better what is inside the marketing mix
how can you mix and remix it better it’s like being a DJ it’s about combination
it’s about fine-tuning it’s about balancing so most typically the
marketing mix is commonly referred to as the four PS the four PS of product price
place and promotion now this is the most classical definition of what the
marketing mix is if you want to boil down a lot of the marketing choices in a
company this is a very effective way to understand what it is about I need to
think of a product I remember in the broad sense think of the offering think
of the combination between product service brand ideas so think of product
in the broadest possible sense and that’s one leg of my table then I need
to decide a price is gonna be high low is it gonna be
fixed is it gonna be a subscription is it gonna be maybe zero for a few months
and then you pay later many many combinations and many choices
on that leg of a table and then you decide about the place where will I make
this product available to my customers do they need to come to a store and buy
it is this something that they can click and receive at home I mean how many ways
are existing for this place to to exist and think also digitally the place can
be digital because sometimes we’re just buying something which is intangible
let’s say you buying a movie over the internet or you buying a software a
software service that you buy for a subscription 9 euros a month then the
place is actually a virtual place where you get a download so you can get it
right on your computer the promotion is all the ways in which you make this
known to your customer you know the big risk for a company sometimes is to have
a great product with a wonderful price level a wonderful place choice but then
they forgot about promotion you know not enough people know about this and that
that’s bad you know you need to let people aware that you exist as a present
as a value proposition and also you need to people to be aware that they should
prefer you compared to others when we speak about communication and promotion
we understand this better it’s not just about letting you know that I exist
by me it’s actually by me and not the other because for you my value
proposition if my segmentation and targeting
was good should be better for you so again here there will be a lot of
choices around this think about the product the variety the quality level
the design of the product the packaging are many versions you know a lot of
things and the price I said that before in
over time one time and even in simple things that when you go and buy a pizza
am i buying a cheese pizza am i buying all-you-can-eat am i buying a fixed menu
all combination of price am i paying a monthly subscription and i can come here
and buy pizza as much as i like and then the place again as I said before what
type of channels all the decisions about the logistics things that are gonna
happen between how long is gonna be the chain of the people involved and of
course the promotion what type of messages I’m gonna send what type of
public relations I’m gonna have what type of use of social media I will have
to do in order to balance this and remember is not just my choices but it
was what happened in the market and sometimes I make mistakes remember that
in recent times you will see more and more debate people said mmm the four
peas are dead you now think of the four C’s now you always have to be careful
when people are telling you that something is out of date is out of
fashion the four PS still valid they’re still applicable and
and I think it’s very difficult to say that you know that they are not useful
it’s just that thanks to the evolution of the markets and impact of digital
technologies there are other ways that they’re helping us to have a broader
picture so I wouldn’t say I wouldn’t agree with people that say mmm forget
about the four PS use the four C’s is that that you can use other ideas and
concept that help you better so the message is yes the product is important
but it goes back to what I said before think of the customer solution be in the
customer mind don’t be in the end in engineers room be close to the customer
so the idea some people don’t want to use the term product because they make
you think too much inside the company they want to talk about the customer
solution they don’t want to think about price they want to think about the
customer cost they don’t want to think about place they want to think about the
convenience of the customer of getting that product available to him and they
want to talk about communication again it’s just a matter of definition
it’s always about the four piece and when you visit a store you can go inside
flying tiger maybe maybe did any of you ever enter a tiger store a flying tiger
store raise your hand most of you and it’s very interesting when you think
about the tiger marketing mix right so you think about the price and some the
price tends to be very accessible you think about the place very quickly you
know its store normally located in a city you shaped in a way that is not
easy to move they want you to be there right if your train is leaving is better
not to enter Target it might be trapped what about the promotion there’s not
much communication advertised in the store normally is the promotion itself
you walk in and says I want to go there and when you think about the product
when you think about Tiger think about the product what is the problem what is
Tiger selling yeah you saying one of your colleagues has useless things I I
sort of agree and sometimes those are things that they break by the time you
arrive home they are already broken right by the way I love flying tiger but
if you think of it think about the value proposition what are we buying we’re
buying a distraction we’re buying some fun think of it if you go into Tiger
normally is that because you need something it’s just because you want to
have some fun and you’ll probably spend 3 5 8 12 or sometimes even more euros
but you do this often you see you’re going back and so again going back to
what the customer is buying Tiger doesn’t really care much if what you
bought is probably be broken when you go home you’re gonna be complaining why
because you know as part of the game I just wanted to have fun look at this is
Halloween’s gonna be coming and then the seasonal thing it goes back to the
choices so you need to be consistent ok and that goes back to the choices so we
also go back to issues like the marketing plan when you need to have a
strategy then you need to make a plan if you go to a small company the marketing
plan would be very simple sometimes it doesn’t is not it doesn’t exist in a
written form well we know our marketing plan now the bigger the company the more
structure then form the marketing plan will be so if you go
to a bigger company you will find sometimes a very big big document it
will contain of course maybe a summary at the beginning but then it will
contain an analysis of the situation and analysis of what the competitors are
doing the objectives and then all the the strategies and the actions also with
the idea of the budgets and the controls remember the numbers because we need to
go back and have the ability to monitor if things are going the way we wanted
normally they don’t because you can just get it wrong so the important thing is
to feedback the information and adjust it reposition recalibrate your analysis
and and so that’s as I said you know the typical ingredients and contents of the
plan that you typically have and you need to have it because there are so
many alternatives that you need to make a plan you need to tell your colleagues
what you’re going to do so a marketing plan is something you need to engage
your team hey this is the plan this is what we’re going to go you need to share
with your colleagues your direction that we want to go for high customer service
for high quality do you want to go for accessibility do we want to go for being
unique in the way we make feel to fill the customers and then of course it
plans it specifies who’s gonna do this when it creates timelines okay so in the
last part of our lecture as I said before digital is impacting so much and
in this first lecture we’re creating our foundations to understand what marketing
is understanding the complexity of decision were going to take and we’re
also creating a better understanding of the perimeter that is changing because
of the impact of digital technologies so something that we’re doing and for
example parody on materials will use the metaphor of marketing 4.0 like one of
the most widely known authors about marketing Philip Kotler he recently
published work talking about marketing 4.0 it’s like a new release of marketing
now there is this link to the fact that everything that we have is constantly
baited and I like to trace it back to about 20 years ago 20 years ago a group
of people published the Cluetrain manifesto now I invite you to go to
Cluetrain calm is the site where a group of people they published a set of
propositions actually there are 95 propositions I’m not saying you need to
memorize all of them I’m not saying you need to study all of them there will be
part of the exam but the concepts around them are very powerful as a group of
people they are seeing twenty years ago the impact of digital technology is
arriving and they specify messages sometimes in a very aggressive and funky
way if you say a little bit of like a rebels you see the tone of voice in the
Cluetrain manifesto is like sounds like is written by pirates and you know what
I love the first proposition for me the first proposition and bodies the essence
of the current challenge that the marketing has markets are conversations
what does it mean it means that today because of the things I told you because
of the the way the environment is changing the way in which we are as
customers enabled through our digital tools to be connected in a new way we
need to make sure that we as companies we as brands engage in a conversation
with us customer to get the data to fit it back to feed business going along for
you to stay loyal etc so I find this very powerful this is just the first of
the propositions you can go online maybe some of you are actually doing this at
the moment and you find that there are many others I just invite you to browse
through them and see how they specify how the power now is being shifted in
the hands of customer I told you before consumer generated marketing so
companies they need to do the triple printable work than they did in the past
in order to orchestrate this process and so these are the power shifts so people
like Cutler and and many others are actually helping us to understand how
this power shift is to the connected customers is creating some
some transformations for example this issue between moving from exclusively to
inclusive more and more companies I are trying to actually promote products for
emerging markets they want to become more inclusive a very cheap computer a
very cheap cell phone a very cheap water production mechanism a you can use rain
and make water there is big issue some marketing people are actually thinking
of in order to make products more accessible sometimes
walls are blurring between industries think about the way now you can use
technology and money we are now in an age in which we can sort of send a
whatsapp message and give a few euros to a friend like the convergence of the
financial and the cellphone industry think about the collaborations and
innovation and again this is one of the big trends that there’s actually being
shaped and a movement from vertical dimensions to horizontal dimensions all
this discussion about open innovation even in marketing more and more
situations are creating companies to to collaborate with each other to
collaborate with research institutions to collaborate with customers and in
play a new game there’s a new type of competition think of the way in which
Buber or Airbnb are some of a some sort of a horizontal player that are
competing with the big vertical change of of hotels and maybe a transportation
providers and think of the the customer trust in the past it was sort of
vertical the company said hmm I am important I am big I am historical you
need to trust me and now this has become horizontal why because you are looking
at reviews you sharing information with customers you believe more in your next
customer than in what the company says you’re going to filter that information
again power to the customers and the movement from the individual to the
social dimension I mean you know this very well your generation
very well you have become an active media of communication you can
livestream a product presentation you can livestream a shopping situation this
can go into a cycle of communication and become viral very quickly again
community generated content the community of users is actually doing
things produce an information producing ideas and it’s important to be authentic
and there are also some paradoxes in marketing 4.0 you have this paradoxes
because the online and offline are converging as I said before high tech is
also allowing you to be high touch so if is used correctly is not cold technology
is allowing you to create new environments think of augmented reality
or virtual reality well now we will be able to shop for books and have a
conversation of maybe the hologram of a very important author from the past or
maybe a musician and that we will have this this this artificial context but it
will become very warm to us if it is calibrated to our needs and this will
become a blend of experiences think of the customer being very engaged but at
the same time very distracted now we are bombarded we are just multi-screen
with doing more than things that at once think of the battle for customer
attention if you are a marketer today you need to be very focused and work in
a way that you will be unique your segmentation targeting and positioning
will have to work in a way that you emerge in an ocean of messages and again
as I said before you have no control over brand conversations once they are
like you throw a message in a bottle in the ocean then it goes on his own you
cannot really control it and again the advocacy the word-of-mouth
now are you a fan and then you create positive reinforcement or you destroy
the value something that is becoming very popular is the so-called
Net Promoter Score he calculates the amount of people that are
advocates of our brand you know they go around they recommend the brand of the
product they said you can go to buy this you know you need to buy this thing you
need to trust me so that’s the that’s that the positive thing but then you
have the detractors the people are saying you know what do not buy that
product I had a terrible experience they treat you bad it breaks apart so the Net
Promoter Score is something that reichheld marketing expert created to
help companies have a measure that is actually impacting on your ability to to
work well and so a lot of marketers are using this Net Promoter Score is that
the percentage of promoters positive promoters minus the percentage of
detractors and of course you need to balance love and hate so how do you
market in the digital economy well the communities are the news
segment so you have these communities of interest around the social media and
digital environments so they are the new segment you need to ask permission I
think you realize more and more now also with the new gdpr and the regulation
you’re asked to be agree consenting because we don’t want to be invaded so
now it’s about asking permission you know now what happens very frequently in
a store when you buy something when you pay typically they say do you want to
leave us your cell phone or your email you want to be in touch does that happen
to you because they want to create a conversation you go back to the
Cluetrain manifesto proposition one markets are conversations they want to
keep you in the flow of connection they want they don’t want to lose you but
they ask permission and of course you give the permission if you feel it’s
okay otherwise you will say no so there is a button for attention this is a
battle for permission it’s very important to decide what is your brand
character am I going to be true to my spirit and this element of co-creation
and collaborative customer care think of all the to beaut YouTube environments
where actually customers are creating communities for a better use of the
product think of sports product tech products and all the places were
actually this is typically co-creation in action in collaborative cast
macare and again it’s something that a company is only enabling but it’s not
controlling so in the last part of the this lecture which of course is very
dense because it creates for you an environment of some of the topics we’ll
be going through in more detail over the next weeks we need to remind ourselves
it’s not just digital marketing it’s marketing in a digitized world in a
digital world in a world that is being transformed by digital technologies so
the things we’ll be looking at using some of the expressions promoted by by
culturally marketing 4.0 or is some of the things we just look around in our
experience as customers we see the things that change it think of products
you think of what P Quadro is doing peak weather is a brand doing trolleys bags
leather cases for for business cards wallets and they using technology in
order to make product smart they have a line of products they call connect you
and actually they sync with your phone and for example if I walk away my bag is
there my phone will ring and say hey you set 10 meters distance you probably
forgetting me here or maybe you can set it in a way that it talks with the cover
your iPad and you leave home and then the phone will beeps and says hey the
back is realized and you left the iPad somewhere else in your home they are
imagine a backpack with your testing and it’s actually using a system that
provides a navigation system it it sort of gives you vibration and left if you
need to turn left vibration right you need to go right think of all the ways
you can boost the digital element in a product think of milla milla i don’t
know how often you use a washing machine as a student or maybe you outsource
tears to a different place but this is just an example of a company
like Mila says how can we move from this idea of just the product to a service
you know and they are promoting for example an app and the idea is that it
used this app to scan a dot a stain and then supposedly it’s going to tell you
what program you need to use what type of quantity in
turgid you need to use so again this is idea of enhancing the product now I’m
not sure it’s gonna work anyway but you know that the idea is interesting moving
from product to service again back to the marketing mix price think of
yourself when you’re buying a flight ticket did you ever go and buy a ticket
on particularly low-cost airlines like easyJet and Ryanair raise your hand any
of you recently what happens typically you go there you take a look I would
like to go to Barcelona and I want to buy this this flight now I’m just gonna
think about this for a moment and then maybe you ask your friend or your
partner or your family maybe I might go you want to look for a hotel and then
you gotta go back what happens the price went up did you notice this how was just
two hours ago but the cookie installed in your machine let the system know that
you went there what is it doing it’s creating two things sense of
scarcity sense of urgency price went up typically says only three left are gonna
be moving and then the technology here is playing a little bit of trick on you
and it’s actually extracting higher willingness to pay because if you bought
that as the first moment maybe they were cheaper so typically when you go back
that is the cookies right so here is the cookies like the system will probably
know well maybe the price went up maybe there
are three left but just because of a different reason again so this is the
way in which digital is playing tricks on us and sometimes we want to we don’t
want to be played by the system but it also plays interesting games now some
brands like like your Burberry Gucci Tod’s Bottega Veneta they now have
started for some time to differentiate their direct emails them is what you
typically call a direct email is when you subscribe to a list you know maybe
you left your email and then you receive maybe weekly or monthly communications
they segment and differentiate by gender what does it mean it means that the
newsletter that I receive as a mail we’ll be different by the newsletter
that she receives as his female why this is better targeting because it’s more
likely than in fashion a man or a woman in a male or a female there is a high
probability in a non universal but they might like different things and think
about digital communication the power of Instagram
do you have an Instagram profile raise your hand many of you what is the power
of the Instagram the power of Instagram the success of Instagram is the ability
to contextualize things now this is just an example of a cover of the trunk for
for a car in this case it is that the trunk cover for a GLA a Mercedes now I
don’t really care about the specific product I like for the message imagine
you can go online and see all products now the power of Instagram is to provide
the context look at this it’s the same object in this image there is a the
cover for the trunk and it’s the same image dressed up in two different ways
right so that’s the power of Instagram it is the power of a marketing strategy
to provide the context imagine for a bottle of water there is a combination
of a power of a story a combination of things around that then then changes the
product itself think of new models like the Dollar Shave Club Dollar Shave Club
is is a new way that the company used to actually sell you the shaving kit in a
way that actually they want to have you engage in a subscription model so you
get a kit then if you like it they will ship it to you constantly and you pay
some money in a subscription more and more companies now they want you to
subscribe they want to create a constant flow of revenue and think about the
success of Amazon Amazon did not just win because of the low prices it won
because of the convenience the power of the one click you know in the past
people said in the past people said nobody will buy shoes online
now shoes the line of big business I mean most of you are probably buying
up because the technology evolved the customer service evolved you can really
browse better you can get accommodation you can shoot them back companies would
change them so things are changing and and I was mentioning the Amazon
power the one-click power you know the fluidity the seamless you can really
just say click that’s it I don’t have to go through a very burdensome and complex
set of activities because that’s gonna work very well and again technology is
powerful think of if you imagine a Japanese Tokyo window of a Shiseido
store using technology where the colors of the window change depending on the
type of color you’re wearing so if there is the person with a blue with a blue
sweater watching the window the window would become blue and if there is a
person watching the window with a weaver red sweater I will turn red what is nice
is the conversation going on it’s the store becoming active imagine that more
and more we will see stores reconfiguring not just the digital not
the same way in which a portal or a website is changing around you but also
a physical store that will be very important and you can see maybe
developments of brands maybe they want to use pop-up stores they want to create
temporary experiences when you receive maybe a time the invitation with a
special code they say hey from this time to that time you’re invited to see a
preview of our new collection and then you use this code you access again
experiences blended with the products and think think of coffee think of what
the expresso did and the ability to think omni-channel this is something
we’re gonna go back you cannot think of okay I have a physical store okay a
website you need to be consistent and seamless across all experiences some
customers will in different moments want to go to the store or some customer they
will want to receive things at home or maybe they want to do a self-service but
you need to have one customer record you cannot start from scratch every time you
know are many industries think of the automotive industry
how is gonna be related in the new marketing digital challenges you know
how can you do ecommerce for a car is a little bit more complicated than
e-commerce for a book or maybe for for for other products but they already
started to think about this so it’s either think of smart maybe
smart was one of the first initiatives pushing ecommerce for in a real sense or
maybe partnering with Amazon where you can actually buy a booking for a car or
maybe creating stores inside shopping center this was more the route of for
example he and I and then to boost the digital experience to complement that
outside the typical car dealer so all this is actually creating a wave of
complexity it’s making things more complicated and difficult so my
invitation to you over the next weeks would be to try to make connections in
three ways one try to connect the things that we share together in in this
content in this marketing topics try to connect them they are all connected they
are a mosaic the value of your learning will be enhanced if you connect them do
not just put them in the drawers and keep them separate so do this connection
second connect them with the things that you’re currently studying and the things
you’ve already studied they will become more powerful and thirdly try to connect
them or relate them to your experiences as customers every time you go and buy
something you shop for something you watch an ad try to connect it to some of
the things that was proposing to you try to look at what’s behind my ambition as
a teacher in this course is to help you take it a little bit in the other side
the other side is is where actually the company is doing things there’s planning
things deciding things around you as a consumer sometimes you do not see I
would like to take you there and see the code the more you see the code the more
you can decode and the more then you can code the marketing strategy surely it’s
very difficult that you probably join a company and you become a marketing
manager from day one you probably join a marketing team it will work alongside
marketing people but then you will breathe market
and your ability to do and perform well will reside in your ability to make the
connections within the things we’re talking about the things you studying
enough in other topics and in your experiences the more you do that the
more you’re likely to succeed and have an impact in the results of the company
so we’ll see you in the next lecture and good luck

About Ralph Robinson

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