More from Prof. SSK

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SSK, , BRAND MANAGEMENT, , Unit 3: MARKET POTENTIAL & SALES FORECASTING, Forecasting target market potential and sales – Methods of estimating market and sales, potential, Sales forecasting, planning for involvement in international market., , Meaning of Market Potential: Market potential refers to the total potential sale of a product, within a given period of time and for a given geographic area. It is a quantitative estimate of, the total possible sales by the firms selling the product in a given market., Meaning of Sales Potential: This is the share of market potential allocated to a specific, geographic area for a particular product, or the share of the total market potential that a, manufacturer can reasonably expect to sell., MARKET POTENTIAL ANALYSIS,  Categorize countries as lead markets, break-out markets or emerging markets,  Quantify market potential for a given product by country, region or globally,  Identify growth drivers and barriers in those markets,  Understand how to exploit growth markets,  It helps in meeting customer demand,  It helps in overcoming market barriers, CRITERIA FOR EFFECTIVE TARGETING OF MARKETING SEGMENTS,  Identification: To divide the market into separate segments on the basis of a common, need or characteristics., o Geographical location, o Demographic characteristics such as age, gender, occupation etc., o Life Style, o Consumer behavior,  Segment Size: For a market segment to be worldwide target, it must have a sufficient, number of people to warrant tailoring a product.,  Stability: Most marketers prefer to target consumer segments that are relatively stable, in terms of demographic and psychological factors.,  Accessibility: A fourth requirement for effective targeting is accessibility. The, marketers must be able to reach the market segments they want to target in an, economical way., , TARGET MARKET SELECTION PROCESS, , , Identifying approaches for selecting target markets: The targeting strategy, used is affected by target market characteristics, product attributes and the, organization’s objectives and resources., - Undifferentiated Approach, - Product Differentiation Approach, - Concentration Targeting Strategy Approach, - Multi-Segment Approach, , Compelled By- [email protected], , Page 1

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SSK, , BRAND MANAGEMENT, -, , Differentiated Approach, , , , Determining the factors affecting forecasting, - Factors for prevailing business conditions, - Conditions within the industry, - Conditions within the firm, - Factors affecting EXIM control, - Factors affecting sociological conditions, - Factors affecting psychological conditions, , , , Develop Market Segment Profiles: Market segment profiles describe the, similarities among potential customers within a segment., , , , Evaluate Relevant Market Segments: By sales estimate potential sales for a, segment can be measured along several dimensions .It includes product,, geographic area, time and level of competition., , , , Select Specific Target Markets: Marketers first decide whether there are enough, differences, In customers’ needs to warrant the use of market segmentation., , MEANING OF SALES FORECAST: A sales forecast is an essential tool for, managing a business of any size. A well-constructed sales plan and accurate sales, forecasting helps in developing business. It helps in responding to day-to-day, developments in sales and marketing., SIGNIFICANCES OF SALES FORECASTING, , , , , , , , , , , , , It helps in determining sales compensation plan, It helps in determining of sales territories, It is useful in advertising and sales promotion programs, It helps in fixing the price of the product or service, It helps in production plan, It helps in regulating inventories and purchasing, It helps in estimating standard cost, It is useful in budgeting and controlling expenses, It is useful in planning cash requirements, It helps in master plan of the company, It helps in integrating business plan, , ADVANTAGES OF SALES FORECASTING, , , , , It helps in reducing inventory, It helps to schedule customers’ orders, It is useful in plant procurement planning, , Compelled By- [email protected], , Page 2

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SSK, , BRAND MANAGEMENT, , , , , , , , , , It is very helpful in cost cutting, It helps in prediction of revenue, It is useful in preparing comprehensive marketing plan, It helps in allocating the marketing resources, It helps in monitoring the competition and the product environment, It is the basis of sound budgeting, It is useful for measuring the efficiency of sales department, It is useful for planning personal selling, advertising, warehousing arrangements etc., , DISADVANTAGES OF SALES FORECASTING, , , , , , , , , , It is expensive, It consumes lot of time, It requires skilled people, It requires huge analysis of data, The forecast accuracy can be reduced when forecasters consider readily, recently perceived information, The ability to forecast accurately may be reduced due to inappropriate data patterns, The ability to accurately forecast may be significantly reduced by, organization political factors, The inconsistencies in judgment may lead to reduced accuracy, , CLASSIFICATION OF SALES FORECASTNG TECHNIQUES, , , QUALITATIVE TECHNIQUES: Estimating method that relies on expert human, judgment, opinions, intuition or personal experience and are subjective in nature, combined with a rating scale is called qualitative technique. They do not rely on any, rigorous mathematical computations, -, , Expert Evaluation Techniques: In this technique the experience of people is, used. It includes executives, salespeople, marketing people, distributors or outsider, experts., , -, , Jury of Executive Opinion: - In this technique jury of executive such as finance,, marketing, sales, production, logistics etc. Meet to generate forecasts. The, opinions of these executives are considered. The jury of executive opinion is one, of the most familiar and frequently used of all forecasting techniques., , -, , Delphi Method: It is a sophisticated statistical method to arrive at a consensus., It consists of the following process: The panel expert are selected to give, suggestions to solve the problems in hand. Both internal and external experts can, be the members of the panel., , -, , Demand Estimation: Business enterprise needs to know the demand for its product., An existing unit must know current demand for its product in order to, , Compelled By- [email protected], , Page 3

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SSK, , BRAND MANAGEMENT, avoid underproduction or over production., -, , Sales Force Composite Method: The sales force composite is a, qualitative forecasting method that uses the knowledge and experience of, a company’s salespeople., , -, , Survey of Buyer’s Expectation: The survey of buyer’s expectation is, conducted to know the buyer’s intention. It is conducted by taking the market, test sample of potential buyers., , Past Sales (Historical method):, Personal judgment of sales forecasting can be beneficially supplemented by the use of, statistical and quantitative methods. Past sales are a good basis and on this basis future sales, can be formulated and forecast. According to Kirkpatrick, today’s sales activity flows into, tomorrow’s sales activities; that is last year’s sales extend into this year’s sales. This approach, is adding or deducting a set of percentage to the sales of previous year(s). For new industries, and for new products, this method is not suitable., (a) Simple Sales Percentage:, Under this method, sales forecast is made by adding simply a flat percentage of sales so as to, forecast sales as given below:, Next year sales = Present year sales + this year sales/Last year sales, Or = Present year sales + 10 or 5% of present sale, (b) Time Series Analysis:, A time series analysis is a statistical method of studying historical data. It involves the isolation, of long time trend, cyclical changes, seasonal variations and irregular fluctuations. Past sales, figures are taken as a base, analyzed and adjusted to future trends. The past records and reports, enable us to interpret the information and forecast future trends and trade cycle too., Statistical Methods:, Statistical methods are considered to be superior techniques of sales forecasting, because their, reliability is higher than that of other techniques., (i), Trend Method, (c) Moving average method, (ii), Graphical Method, (d) Method of least square, (iii) Time-series Method:, (iv), Correlation method, (a) Freehand method, (v), Regression method., (b) Semi-average method, INTERNATIONAL MARKET, Definition of Sales Management: According to the American Marketers Association, (AMA), Sales management is the planning, direction and control of the personnel,, selling activities of a business unit including recruiting, selecting, training, assigning,, rating, supervising, paying motivating as all these tasks apply to the personnel salesforce., , Compelled By- [email protected], , Page 4

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SSK, , BRAND MANAGEMENT, Definition of International Marketing: According to Cateora (1997), international, marketing is the performance of business activities that direct the flow of company’s, goods and services to consumers in more than one nation for profit., APPROACHES TO INTERNATIONAL MARKETING, , , , , , , Domestic marketing extension (ethnocentric) concept: The companies, guided by this are casual players in overseas markets. For them the overseas, markets serve as conduits for directing surplus production., Multi domestic marketing (polycentric) concept: As the overseas, operations of the companies grow, they recognize the need for a different, approach to international marketing. The operations of companies can, acquire forms of overseas joint ventures, licensing agreements, overseas, manufacturing and marketing., Global marketing (re geocentric) concept: As the companies direct, their approach to become a global company, they acquire a global, perspective in their operation., , IMPORTANCE OF INTERNATIONAL MARKETING, , , , , , , , , , , Employment generation, Increased Linkages, Stimulates Competition, Technology Sourcing, Optimal Utilization of resources, Educative effect, Promotes foreign direct investment, Increase in national income, Efficiency, , Planning Process for Involvement in International Market, 1. Educate yourself on the customs and business etiquette of the international, market. When entering a foreign market make sure you know the country’s history, the, proper way to greet someone, the ordinary times for lunch (or prayer in many African,, Asian and Middle-Eastern countries). Make sure you are communicating with them in the, expected way within their society -- e.g.: with the appropriate salutation., 2. Gather historical data on the country’s currency value fluctuation and, import/export timelines. This is crucial. The deal you discuss today may not be executed, in time to reap the full potential of the opportunity. You could be negotiating a deal that, may cost 15 percent more in a few months when the transaction is finalized. Worse yet,, you may offer a promotion that costs you significantly more a week into the offering., Lock in currency rates and delivery dates in advance whenever possible. The less, speculation, the better., 3. Become an expert on the country’s laws governing business. Have local representation, if possible, someone who can help you navigate any unforeseen obstacles and explain all, Compelled By- [email protected], , Page 5

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BRAND MANAGEMENT, , SSK, , contract provisions and terminology. Know and understand the laws and legalese of the, jurisdiction that governs your contract before it becomes legally binding., 4. Conduct focus groups to test the waters in the prospective international, market. Understanding each country’s culture means you have to find ways to reach what, would otherwise be the same demographic but in a different location. A new approach, may be needed to make your product or service suitable to the needs and expectations of, the potential foreign market and its culture. Studying these countries, including their, professional and personal customs, will ensure that you conduct yourself in a respectful, way. This will also signal to the business leaders and potential customers in the new, market that you know their protocol and you’ve take the time to adapt to it., 5. Find out what your competition has done in the same territory. Has one of your, competitors tried to enter this market before? What obstacles did they face? How did they, approach the new market? And most importantly, what would you do differently?, , Compelled By- [email protected], , Page 6

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SSK, , BRAND MANAGEMENT, Unit 4: BRAND MANAGEMENT, , Meaning of Brand – Brand Development: Extension, Rejuvenation, Re launch- Product vs., Brands, Goods and services, Retailer and distributors, People and organization, Brand, challenges and opportunities, The brand equity concept, Identity and image., Meaning of Brand, A brand is a product, service, or concept that is publicly distinguished from other products,, services, or concepts so that it can be easily communicated and usually marketed., A brand name is the name of the distinctive product, service, or concept. Branding is the, process of creating and disseminating the brand name. Branding can be applied to the entire, corporate identity as well as to individual product and service names., Meaning of Brand Management: It includes managing the tangible and intangible, characteristics of band. In case of product brands, the tangibles includes the product itself,, price, packaging etc. While in case of service brands, the tangibles includes the customer’s, experience. The intangible include emotional connections with the product or service., OBJECTIVES OF BRAND MANAGEMENT, , , , , , , , , , , , To produce, promote and distribute goods that are attractive to consumers., To provide best deal to customers in terms of utility value compared to competitors, To control consumers’ brand choice behavior, Creation and management of brand equity, Optimum utilization of resources, Enhance brand image, Enhance market share, To restrict market value, Ensure right marketing mix, It forms customer perceptions about the product, , CHARACTERISTICS OR FEATUERS OF BRAND MANAGEMENT, , , , , , , , , It includes developing a promise, making that promise and maintaining it., It deals with determining the brand, positioning the brand and delivering the brand, It is an art of creating and sustaining the brand, It ensures customer commitment, A strong brand differentiates the products from the competitors, It enhances the company image, It creates a confidence in the current and prospective customers., , BRAND, A brand is the specific type of the product form. A brand is presented by a brand name,, symbol, design, logo, packaging etc. It is the identify of a particular product form that, customers recognize as being different from others., Compelled By- [email protected], , Page 7

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SSK, , BRAND MANAGEMENT, CHARACTERISTICS OR FEATURES OF BRAND, , , , , , , , It is a promise that the product will perform as per customer’s expectations, It shapes customer’s expectations about the product, It usually has a trademark which protects them from use by others, A brand gives particular information about the organization, good or service, It helps in differentiating it from others in marketplace, Brand carries is a means of making people aware company offerings, , BRAND NAME, Brand name is one of the brand elements which help the customers to identify and, differentiate one product from another. It should be chosen by very carefully as it, captures the key theme of a product in an efficient and economical manner., , BRAND ATTRIBUTES, , , , , , , , , , Relevancy: A strong brand must be relevant. It must meet people’s expectations and, Should perform the way they want it do., Consistency: A consistent brand signifies what the brand stands for and, builds customers trust in brand. A consistent brand is where the company, communicate message in a way that does not deviate from the core brand, proposition., Proper Positioning : A strong brand should be positioned so that it makes a, place in target audience mind and they prefer it over other brands, Sustainability: A strong brand makes a business competitive. A sustainable, brand drives an organization towards innovation and success, Credibility: A strong brand should do what it promises. The way the company, communicate the brand to the customers should be realistic., Uniqueness: A strong brand should be different and unique. It should set, the company apart from other competitors in market, Appealing: A strong brand should be attractive. Customers should be, attracted by the promise the company make. The values deliver by the, company., , BRANDING, According to Kapferer and Keller, the branding is defined as fulfilment in customer, expectations and consistent customer satisfaction., , MERITS OF BRANDING, , Compelled By- [email protected], , Page 8

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SSK, , BRAND MANAGEMENT, , , , , , , , , , , , , It identifies the seller, It helps in identification of a product, As per law, seller is granted exclusive rights to the use of the brand name, It is a seller’s promise to consistently deliver what it stands for to the buyer., It conveys certain attribute or features of the product or service., It may represent certain culture, Differentiation of product from its competitors, It represents personality, It suggest kind of consumer who buys or uses product, It helps consumers identify products, tells buyer something about quality, It gives the seller advantages, , BRAND DEVELOPMENT, The process of creating and strengthening the professional services brand is, called Brand development., Brand Development includes:, , , , , Getting the brand strategy right and aligned with the business objectives, Developing the tools needed to communicate the brand, Strengthening the developed brand, , PROCESS OF DEVELOPING THE BRAND, , , Establish the Market Opportunity: Using a combination of desk-based, research and market knowledge the company can establish the market, opportunity. The company needs to do the following:, - Measure the size of the potential market for their products, - Establish the entry barriers, - Determine competition, - Know current market trends that could have an impact on products, , , , Determining the Target Audience Profile, To ensure customer satisfaction the marketer must know the exact profile of end, user. The factors to be considered are:, Average age, - Social status, - Lifestyle, - Shopping place, - What they buy, - Price sensitivity, Identify the Product Benefits to Customers, It makes it easier to identify the product benefits that will appeal to the target., These benefits can be built into the marketing messages and product story., For example: The target customers have little or no cooking skills then they, , , , Compelled By- [email protected], , Page 9

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SSK, , BRAND MANAGEMENT, are more likely to buy pre- prepared foods., , , , , Decide on USPs (Unique Selling Points), The marketer needs to identify the uniqueness of their brand compared to competitors, Brand. The uniqueness could be through the following:, - Product, - Packaging, - Message, - Promotion, - Availability etc., Find a Name, The companies need to find a name. It must be associated with brand values and, personality. The name must be understood easily by the target audience. The, companies can protect their names by getting the name trademarked., , , , Positioning the Product, The positioning is vital for success. To determine the optimum position for the, product there are three keys tasks which would be beneficial to undertake., , , , Develop the Marketing Strategy, The marketing plan will become an invaluable operational tool to keep your, initial brand launch and subsequent support on track., , , , Design the Product Packaging, The importance of packaging should not be underestimated. It is one of the key, interactions that materials which will help communicate the brand., , , , Determine Appropriate Sales Channels and Develop Supporting Material, The next step is to develop supporting materials. The marketer needs to consider, developing the materials which will help communicate the brand., , BRAND EXTENSION, The use of a successful brand name to launch a new or modified product in a new, market is called brand extension., Advantages of Brand Extensions, , , , , , , , It enhances the business growth, It enhances profitability, It enhances brand power, It provide boost in international visibility, It helps to compete in less saturated markets, It creates value to company, , Compelled By- [email protected], , Page 10

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SSK, , BRAND MANAGEMENT, , , , , , It helps to satisfy customers, It inspires a high level of trust in customers, It creates positive attitude towards brand, If influences the buyer behavior, , BRAND REJUVENATION, It is also called as brand revitalization. A brand over a period of time results in, declining of its strength. The solution for a brand in decline can be revitalization. It, is based on updating of the overall offer of the brand while staying true to part of its, identity., REASONS FOR THE DECLINE IN BRAND ARE:, , , , , , , , , The brand may not have adopted to environmental changes, Changes in consumer preferences, Ageing of its core consumers, Technological change, Life style of consumer, Change in preference, Attitudinal change, , NEED OF BRAND REJUVENATION, , , , , , , , , , , , , , , The company is struggling to generate revenues from the current product, The whole product or service category may be decking, To communicate new visual identity system, Unify the brand’s expressions across all audiences, To enhance market share, It helps in promotion activity, To strengthen brand association network, To differentiate the products compared to competitors, Brand may no longer meet the consumers’ needs or desires, The lack of customer understanding of the product, The lack of customer engagement, The lack of customer experience, Poor consumer relationship management, , BRAND REJUVENATION CAN BE ACHIEVED, , , , , , , , Redefining the brand essence, Attract a new customer, Develop new uses of the product or service, New customer networks, Innovation, Segmentation, , Compelled By- [email protected], , Page 11

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SSK, , BRAND MANAGEMENT, , , , Contacting opinion leaders, Effective communication, , RE LAUNCHING AN EXISTING BRAND, Re-launch is defined as any activity that aims to make consumers reconsider a brand, in its totality. This could be through packaging changes, product upgrades, a new, positioning or any combination of several changes in the brand., REASONS FOR RE-LAUNCHING THE BRAND, , , , , , , , , , , Innovation: Technology is constantly upgraded. The company needs to, have the track of innovative technology to be effective in the market. If a, brand is technology related for example: Internet, software, hardware etc., Target Market: Brands need to stay relevant to their target market. The, company needs to keep up with the times and keep pace with changing, customer needs., Competition: The Company required to change the offering to the market in, order to create more utilities in the minds of audience left to communicate with., Mergers and Acquisition: Typically smaller companies start with more, modest brand offering, due to budget restrictions, which are inadequate to, meet the needs of a bigger more sophisticated business and a rebrand is, required., Legal Requirements : Occasionally legal issues may arise that require a, company to make changes to their branding such as copyright issues, Enhance Morale: It is required if a company brand has demoralized, employees or confused customers. The re-launch enhances the morale of, employees and customers, , PRODUCT VS BRANDS, Products perform a function., They have properties that when combined together do something for customers. The problem, is that within any given category, most products perform similar functions. There’s very little, differentiation. Ingredients are ingredients and they tend to be the same across a category., Products are all about what they do for people. Products fulfill a customer’s needs., Functions, ingredients and needs -- that’s what makes up a product., Brands offer an emotion., Brands are actually quite different from products because they don’t just cover a customer’s, needs, they fulfill a customer’s wants., We don’t fall in love with products -- we fall in love with brands. Brands offer a promise and, an emotion. Brands are about how they make people feel. Brands fulfill a customer’s wants., Promises, emotions and wants -- that’s what makes up a brand., The big difference., In short, while you may need a product, you will want a brand. So for example, I may need a, cup of coffee, but I personally want to get it at Starbucks., Compelled By- [email protected], , Page 12

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BRAND MANAGEMENT, , SSK, , Coffee is the product in this case and caffeine is the ingredient. I need it to get going in the, morning and I could get it literally anywhere, including at Dunkin’ Donuts, the corner market or, at home. But I choose Starbucks., Starbucks is the brand in this case, and the experience at Starbucks is the emotion I want in the, morning. I want a Starbucks coffee because of the unique experience I get and from how it, makes me feel. It prepares me for the day ahead and makes me productive in the morning. With, Starbucks coffee, I am ready! I want Starbucks for how it makes me feel., Products equal functions. Brands equal emotions., Hopefully you can see that products are basically at parity to each other, they fulfill the same, needs. Brands are what differentiate because of how they uniquely make people feel., That’s a lot loaded into a few simple paragraphs, which is exactly why we will be probing the, subject in depth over the next few weeks, topic by topic as we tackle not only the difference, between products and brands but also how to manage them both in the process., GOODS AND SERVICES, 7 differences between goods and services, 1) Ownership is not transferred, When buying a service, the service ownership is not transferred to the end customer. If you buy, a car then the car is yours. But if you buy a ticket for an airline, then the airline is definitely not, yours., 2) Intangibility, How do you measure service? In a restaurant, the dish can be measured, but the efforts gone in, making the same dish by two different chefs cannot be measured from the customer end. Same, goes for large service corporates like Accenture and Infosys. The time and effort gone for, giving service to the customer is intangible. Both ownership and intangibility are old school, differences between goods and services., 3) Involvement of customer, When comparing the difference between goods and services we have to look at the involvement, of customer as well. In services involvement of customers is much more than in products. For, example – ATM’s are services wherein customer has to use the machine. The same goes for, vending machines as well as for self service restaurants. Today ice cream chains like hokey, pokey and food chain like Subway have more than 50% involvement of customer where the, customer gets to decide the ingredients they want in their ice cream / Subway sandwich., 4) Quality, In case of products, mass manufacturing is common. And mass manufacturing means, uniformity. However, services involve a lot of manual Labour due to which the quality may, vary each time. Uniformity in services is a factor which each service owner tries for. For, example – The major challenge of food chains like Subway, Pizza hut and dominos is to give, the same quality over and over again, whereas in local restaurants the quality of food may vary, time to time from the same restaurant., 5) Evaluation of services is tougher, As quality varies from time to time and the involvement of customer is maximum, evaluation, of different services becomes tougher. For example – HDFC has more number of ATM than, SBI. Thus we can evaluate that HDFC service is better because they have more reach to the, end customer. But how do we evaluate how a barber cuts your hair., 6) Inventories are absent, Production and consumption of services happens at the same time. This does not mean that the, raw material is not present to provide the service. For example in a restaurant, a dish is made, only after you order it. The raw material and the chef might be present. But the production does, not begin unless and until there is a customer to consume the service., Compelled By- [email protected], , Page 13

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BRAND MANAGEMENT, , SSK, , 7) Time is very important in services, Because inventories are absent in services, and because production and consumption is at the, same time, time is a very important difference between goods and services. The keyword here, is “delay”. There should be no delay in providing the service. Thus the cab should arrive on, time, the food should be prepared by time and the trains should run on time. Because time is, important., RETAILER AND DISTRIBUTORS, , People Brand, People brand is the concept of the “brand” of people who work for your organization, in relation, to your company’s image, organizational culture, key differentiators, reputation, and products, and services. For example, one organization has a “brand” of being built by self-starters, while, another has the “brand” of hiring the best scientists in the market. It is about the culture created, by the employees’ management styles, beliefs and behaviors within the organization. People, branding can help to advance the market position of organizations, attract quality candidates, and depict the type of people who work for your organization., Corporate or Organizational Branding, A corporate brand is a product of an organization's corporate strategy, mission, image, and, activities. Corporate brands distinguish organizations from their competitors, orient, the organization in the minds of customers and employees, and create a perception of what, an organization stands for., , Compelled By- [email protected], , Page 14