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November 2015 Dr. Ute Hillmer
ACustomer Driven Marketing
Strategy: Creating and capturing
CUSTOMER VALUE in an
Online/Offline World
“Ourageofanxietyistheresultof
doingtodaysjobswithyesterdays
technology“
M.McLuhan
November 2015 Dr. Ute Hillmer
WHO is Dr. Ute
Hillmer? anexpertinpositioningandpromotingtechnology
products,withacarvingforinnovativeproductsthat
arenotself-explaining.
Withsuchproducts,humanbehaviorisoftenoutsidethe
boundariesofrationality-despiteitseconomiccontext.
Buyingbehaviorisheretypicallyaresultofsocial,cognitive
andemotionalfactors,alongwiththeeconomicones.
November 2015 Dr. Ute Hillmer
What did Ute do?
• 27 years of international marketing (HP, CoCreate, MFG Innovation
Agency State of BW, Better Reality Marketing)
• Dissertation in business administration, behavioral economics in
technology marketing: Technology Acceptance in Mechatronics
• Worldwide company and product communication;
mainly 3 continents (America, Europe, Asia)
• Product-, program-, channel-, partner marketing, marketing
communication, branding, positioning
• Responsible for operative, strategic + corporate marketing, branding,
sales training
• Experienced in large corporations, SMEs and freelance work as well as
political institutions.
• Responsible for the first international website of Hewlett Packard in 1993
November 2015 Dr. Ute Hillmer
What’s Ute’s
STORY?Iaminbusinessto change
thelivesofmytechnology
clientsbyfindingthem
hungrycustomers that get
them intosustainablegrowth!
November 2015 Dr. Ute Hillmer
and turn their customers into raving fans!
November 2015 Dr. Ute Hillmer
To take the most
out of this lecture
… be in
STATE!
November 2015 Dr. Ute Hillmer
Agenda1. Marketing Today: the new Buying
Decision Process
2. Creating and Capturing Customer
Value
3. Your Ideal Customer
4. Positioning for the Ideal Customer
5. Create your Value Proposition
Creating and capturing CUSTOMER VALUE!
November 2015 Dr. Ute Hillmer
Marketing + Sales
Today:
a New Buying
Decision Process
November 2015 Dr. Ute Hillmer
Role-play to discover:
“Has Marketing changed?”
“Must Marketing change?”
November 2015 Dr. Ute Hillmer
Funnel-Metaphor for a Buying Decision
active evaluation
many brands
Grafik close to Edelman 2010
buying decision
Initial
considerationTrigger
lesser and lesser brands
What brand creates
the most value to
me/us right now
and in the future?
November 2015 Dr. Ute Hillmer
Digitally supported Buying Decision
active
Evaluation
Post-Sales
Experience
Enlarged
Evaluation
Ambassador
Loyalty Loop
Active
Evaluation
Model close to Edelman 2010, p.65
Moment of Purchase
Initial
Consideration
Trigger
What brand creates
the most value to
me/us right now
and in the future?
November 2015 Dr. Ute Hillmer
Information Sources Today
The 2014 B2B Buyer Behaviour Survey
November 2015 Dr. Ute Hillmer
2014 B2B Buyer Behavior Survey
• Web search is the top source of information
• B2B buyers strategically browse social media
• The number of sources used to research and
evaluate purchase has increased
• There is an increased awareness of purchase
options
• The evaluation process is longer and more
satisfying
DemandGen Report Survey 2014
November 2015 Dr. Ute Hillmer
What Role does Social Media Play?
The 2014 B2B Buyer Behaviour Survey
November 2015 Dr. Ute Hillmer
The Core Consequences
1. Consumers and buyers connect with brands in
fundamentally new ways – often beyond manufacturers’
or dealers' control.
2. They evaluate a shifting array of options during the
evaluation process and remain engaged with the brand
after purchase.
3. Customers can have as much information and
knowledge, as vendors do.
Its no longer about “information” it’s about creating and
capturing CUSTOMER VALUE!
You need a customer driven marketing strategy!
November 2015 Dr. Ute Hillmer
Customer Driven
Marketing –
What does that
mean?
November 2015 Dr. Ute Hillmer
From Product- Focus to Customer Focus
Product
Price
Place
Promotion
Customer Needs
Customer Cost
Convenience / Access
Communication
McCarthy: Basic Marketing: A managerial approach, 1960
Schullz, Stanley I. Tannenbaum, Robert F. Lauterborn, Integrated Marketing Communications, 1993
November 2015 Dr. Ute Hillmer
From Product- Focus to Customer Focus
• Making a sale
• Abundance of products in
the nearby shopping
centers
• Television, magazine, and
direct-mail ads
• Satisfying customer needs
• Imaginative Web sites and
mobile phone apps, blogs,
online videos, and social
media
• Reach customers directly,
personally, and
interactively
Traditional View Contemporary View
Kotler, Armstrong 2014
November 2015 Dr. Ute Hillmer Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong 2014
Marketing: Creating Customer Value and
Engagement
Amazon.com’s deep-down passion
for creating customer engagement,
value, and relationships has made it
the world’s leading online retailer.
Amazon has become the model for
companies that are obsessively and
successfully focused on delivering
customer value.
November 2015 Dr. Ute Hillmer
• Objective 1: Understand the fundamental change in marketing
• Objective 2: Identify the key elements of a customer-driven
marketing strategy
• Objective 3: Apply the steps of a customer driven marketing
strategy to your project
Learning Objectives
Marketing:
Creating Customer Value
and Engagement
November 2015 Dr. Ute Hillmer
TheAim of Marketing
• Marketing involves creating value for customers and
building strong customer relationships in order to
capture value from customers in return.
• Goals:
– Attract new customers by promising superior value
– Keep and grow current customers by delivering
satisfaction
– influence the buyer and buying center in the place and
at the moment when they are most open on their way to
brand choice and a buying decision
Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong 2014
November 2015 Dr. Ute Hillmer
The Marketing Process
Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong 2014
What is a prerequisite to create Customer Value?
November 2015 Dr. Ute Hillmer
Customer Needs, Wants and Demands
Understanding the Marketplace and
Customer Needs
• States of felt deprivation
• Physical needs - food, clothing, warmth, and safety
• Social needs - belonging and affection
• Individual needs - knowledge and self-expression
Needs
• Form taken by human needs when shaped by culture and
individual personality
Wants
• Human wants that are backed by buying power
Demands
Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong 2014
November 2015 Dr. Ute Hillmer
• Identify the key elements of a customer-driven marketing strategy
and discuss the marketing management orientations that guide
marketing strategy.
Designing a Customer Value-Driven Marketing Strategy
Preparing an Integrated Marketing Plan and Program
Learning Objective
Marketing: Creating Customer Value and
Engagement
Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong 2014
November 2015 Dr. Ute Hillmer
This is a 2 Day Work Session on
Customer-Driven Marketing Strategy
Day 1: Designing a Customer Value-Driven Marketing
Strategy
1. Selecting customers to serve
– Find your Ideal Customer
2. Creating value for these selected customers
– Define the Value Proposition
Day 2: Effectively communicate Customer Value
– Define a (digital) launch plan
Applying the 20/80
rule to this marketing
lecture …
November 2015 Dr. Ute Hillmer
What does that mean for
you:
Market + sell YOUR
PROJECT in your Internal
and/or External Market
November 2015 Dr. Ute Hillmer
• What is your business goal for the PSA 3?
• What is your business goal for the Master Thesis?
• What is so important about the goal?
• Why is it important?
• Ultimately, what would having that do for you?
Task:
Your WHY!
Write it down on a sheet of paper for you!
November 2015 Dr. Ute Hillmer
PSA3:GoalDefinition+ Communication
Planning
November 2015 Dr. Ute Hillmer
Creating Value for Customers
• Market Segmentation
• Targeting
• Differentiation
• Positioning
Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong
cartoon: fotalia
November 2015 Dr. Ute Hillmer
ContrastingSellingandMarketingConcepts
Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong
November 2015 Dr. Ute Hillmer
Marketing Management in a Customer
Driven Marketing Strategy
Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong 2014
November 2015 Dr. Ute Hillmer
Designing a Customer Value-Driven
Marketing Strategy
Marketing Management is the art and science of choosing target
markets and building profitable relationships with them.
– What customers will we serve?
– How can we best serve these customers?
Market Segmentation refers to dividing the markets into segments
of customers.
Target Marketing refers to which segments to go after.
1. Selecting Customers to Serve
Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong 2014
November 2015 Dr. Ute Hillmer
Task: What
do you
„Sell“
November 2015 Dr. Ute Hillmer
Segmenting a
Market
November 2015 Dr. Ute Hillmer
What is Market Segmentation?
Market segmentation requires dividing a market into
smaller segments with distinct needs, characteristics,
or behaviors that might require separate marketing
strategies or mixes. Kottler, Armstrong 2014
Segmentation is used to identify and further define
your ideal customer
November 2015 Dr. Ute Hillmer
• Segmenting consumer markets?
• Segmenting business markets?
• Segmenting international markets?
• Effective segmentation?
Criterias for
November 2015 Dr. Ute Hillmer
Segmenting Consumer Markets
• The big 4
Geographic
segmentation
Demographic
segmentation
Psychographic
segmentation
Behavioral
segmentation
Copyright © 2016 Pearson Education, Inc.
November 2015 Dr. Ute Hillmer
GeographicSegmentation
RegionsfollowingACNielsen
Geographic
segmentation
divides the market
into different
geographical units
such as nations,
regions, states,
counties, cities, or
even neighborhoods.
November 2015 Dr. Ute Hillmer
DemographinSegmentation
Sinusmilieu
Demographic
segmentation
divides the market
into segments based
on variables such as
age, life-cycle stage,
gender, income,
occupation,
education, religion,
ethnicity, and
generation.
November 2015 Dr. Ute Hillmer
DemographinSegmentation
Age,Gender,Income,…
Age and life-cycle stage segmentation divides a
market into different age and life-cycle groups.
Gender segmentation divides a market into
different segments based on gender.
Income segmentation divides a market into
different income segments.
November 2015 Dr. Ute Hillmer
PsychographicSegmentation
Sinusmilieu
Psychographic
segmentation divides
a market into different
segments based on
social class, lifestyle,
or personality
characteristics.
November 2015 Dr. Ute Hillmer
BehavioralSegmentation
Behavioral
segmentation
divides a market into
segments based on
consumer knowledge,
attitudes, uses of a
product, or responses
to a product.
• Occasions
• Benefits sought
• User status
• Usage rate
• Loyalty status
Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong
November 2015 Dr. Ute Hillmer
Task:
Consumer Market Segmentation for GoPro
November 2015 Dr. Ute Hillmer
Discussion on
Segmenting
Consumer vs.
Business Markets
November 2015 Dr. Ute Hillmer
Segmenting Business Markets
• Consumer and Business have many of the same segmenting
variables. Additional variables include:
Customer
Operating
Characteristics
Situational
Factors
Purchasing
Approaches
Personal
Characteristics
Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong
Geographic
segmentation
Demographic
segmentation
Psychographic
segmentation
Behavioral
segmentation
November 2015 Dr. Ute Hillmer
Segmenting International Markets
Geographic
location
Economic
factors
Political and
legal factors
Cultural
factors
Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong
November 2015 Dr. Ute Hillmer
Intermarket segmentation involves forming
segments of consumers who have similar needs
and buying behaviors even though they are
located in different countries.
7-21
Segmenting International Markets
Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong
November 2015 Dr. Ute Hillmer
Task: Market Segmentation for UPS
November 2015 Dr. Ute Hillmer
Requirements for Effective Segmentation
Measurable Accessible Substantial
Differentiable Actionable
Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong
November 2015 Dr. Ute Hillmer
When Segmenting Markets, watch out for:
Measurability
• “otherwise the scheme will not be operational”
• next to impossible in some markets, hard in most markets => most companies use
qualitative and intuitive methods
Substantiality
• “the variable should be relevant to a substantial group of customers”
• Challenge: find the right size / balance: large group segment: risk of diluting
effectiveness
• Too small: you lose the benefits of economies of scale
• Sometime one large customer
Operational Relevance (Actionable)
• Segmentation should enable to offer the suitable product/service to the chosen
segment, e.g. faster delivery service, special 24-hour technical support, etc.
Source: Webster, 2003
November 2015 Dr. Ute Hillmer
Market
Targeting
November 2015 Dr. Ute Hillmer
Selecting Target Market Segments
.
.
.
.
..
.
.
A target market is a set of buyers who share
common needs or characteristics that the
company decides to serve.
November 2015 Dr. Ute Hillmer
Undifferentiated marketing targets the whole
market with one offer
• Mass marketing
• Focuses on common needs rather than
what’s different
Copyright © 2016 Pearson Education, Inc.
Selecting Target Market Segments
November 2015 Dr. Ute Hillmer
Differentiated marketing targets several different
market segments and designs separate offers for
each.
• Goal is to achieve higher sales and stronger
position
• More expensive than undifferentiated marketing
Selecting Target Market Segments
Copyright © 2016 Pearson Education, Inc.
November 2015 Dr. Ute Hillmer
Concentrated marketing
targets a large of a smaller
market
• Limited company
resources
• Knowledge of the
market
• More effective and
efficient
Selecting Target Market Segments
Copyright © 2016 Pearson Education, Inc.
November 2015 Dr. Ute Hillmer
Micromarketing is the
practice of tailoring products
and marketing programs to
suit the tastes of specific
individuals and locations.
• Local marketing
• Individual marketing
Selecting Target Market Segments
Copyright © 2016 Pearson Education, Inc.
November 2015 Dr. Ute Hillmer
Local marketing
involves tailoring brands
and promotion to the
needs and wants of local
customer segments.
• Cities
• Neighborhoods
• Stores
Copyright © 2016 Pearson Education, Inc. 7-32
Selecting Target Market Segments
Copyright © 2016 Pearson Education, Inc.
November 2015 Dr. Ute Hillmer
Individual marketing involves
tailoring products and
marketing programs to the
needs and preferences of
individual customers.
• Also known as:
– One-to-one marketing
– Mass customization
Selecting Target Market Segments
Copyright © 2016 Pearson Education, Inc.
November 2015 Dr. Ute Hillmer
Choosing a targeting strategy depends on
• Company resources
• Product variability
• Product life-cycle stage
• Market variability
• Competitor’s marketing strategies
Selecting Target Market Segments
Copyright © 2016 Pearson Education, Inc.
November 2015 Dr. Ute Hillmer
Socially Responsible Target Marketing
• Benefits customers
with specific needs
• Concern for
vulnerable segments
Selecting Target Market Segments
Copyright © 2016 Pearson Education, Inc.
November 2015 Dr. Ute Hillmer
• What different market segment strategies are of
relevance in your master thesis project?
• What are 3-5 relevant market segments that you
could target in your internal and/or external
communication?
• Prioritize your market segments and make a short
note on your decision criteria.
Task:
Your Market Segmentation
November 2015 Dr. Ute Hillmer
Segmenting by
Buying (User)
Behavior
November 2015 Dr. Ute Hillmer
Consumer buyer behavior is the buying
behavior of final consumers—individuals and
households that buy goods and services for
personal consumption.
Consumer markets are made up of all the
individuals and households that buy or acquire
goods and services for personal consumption.
Consumer Markets and Buyer Behavior
Copyright © 2016 Pearson Education, Inc.
November 2015 Dr. Ute Hillmer
Model of Consumer Behavior
Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong
November 2015 Dr. Ute Hillmer 5-10
CharacteristicsAffecting Consumer
Behavior
Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong
November 2015 Dr. Ute Hillmer
Business Markets and
Business Buyer Behavior
Business buyer behavior refers to the buying behavior of the
organizations that buy goods and services for use in the
production of other products and services that are sold, rented,
or supplied to others.
The business buying process is the process where business
buyers determine which products and services are needed to
purchase, and then find, evaluate, and choose among
alternative brands.
Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong
November 2015 Dr. Ute Hillmer
Business buyers usually face more complex buying
decisions than do consumer buyers. Compared with
consumer purchases, a business purchase usually
involves:
• More decision participants
• More professional purchasing effort
• More buyer and seller interaction
The Buying Unit
Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong
Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong
November 2015 Dr. Ute Hillmer
MajorTypes of Buying Situations
Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong
November 2015 Dr. Ute Hillmer
User Typologies
„Personas“
November 2015 Dr. Ute Hillmer
Archtypes:
Roger’s
InnovationAdopter
Categories
Foto by: ehoyerEverett Rogers, 1995 “Diffusion of Innovations”
November 2015 Dr. Ute Hillmer
Time
Marketsize
technology life cycle and its buyer
categories
Laggards
16%
Late
Majority
34%
Early
Adopters
13,5%
Early
Majority
34%
Innovators
2,5%
Chart based on Rogers 1995, p. 262 and Moore 1999, p. 12
November 2015 Dr. Ute Hillmer
Persona: Techy
Time
Marketsize
Laggards
16%
Late
Majority
34%
Early
Adopters
13,5%
Early
Majority
34%
Innovators
2,5%
Chart based on Rogers 1995, and Moore 1999
November 2015 Dr. Ute Hillmer
Time
Marketsize
Laggards
16%
Late
Majority
34%
Early
Adopters
13,5%
Early
Majority
34%
Innovators
2,5%
Persona: Visionary
Chart based on Rogers 1995, and Moore 1999
November 2015 Dr. Ute Hillmer
Time
Marketsize
Laggards
16%
Late
Majority
34%
Early
Adopters
13,5%
Early
Majority
34%
Innovators
2,5%
Persona: Pragmatist
Chart based on Rogers 1995, and Moore 1999
November 2015 Dr. Ute Hillmer
Time
Marketsize
Laggards
16%
Late
Majority
34%
Early
Adopters
13,5%
Early
Majority
34%
Innovators
2,5%
Persona: Conservative
Chart based on Rogers 1995, and Moore 1999
November 2015 Dr. Ute Hillmer
Time
Marketsize
Laggards
16%
Late
Majority
34%
Early
Adopters
13,5%
Early
Majority
34%
Innovators
2,5%
Personas: Laggard
Chart based on Rogers 1995, and Moore 1999
November 2015 Dr. Ute Hillmer
LaggardsLate
Majority
Early
Adopters
Early
Majority
Innovators
Mainstream Behaviour
Increasingly
conforming behaviour
Hillmer, Technology Acceptance in Mechatronics, 2009
Zeit
Marktgröße
November 2015 Dr. Ute Hillmer
LaggardsLate
Majority
Early
Adopters
Early
Majority
Innovators
Individualistic Behaviour
Increasingly
individualistic
behaviour
Zeit
Marktgröße
Hillmer, Technology Acceptance in Mechatronics, 2009
November 2015 Dr. Ute Hillmer
Archtypes:
Schein’s
CareerAnchors
Foto by: ehoyer
Edgar H. Schein, 2006 “Career Anchors”
November 2015 Dr. Ute Hillmer
Technical / Fictional Competence
Foto by merkapt
November 2015 Dr. Ute Hillmer
General Management Competence
Foto by merkapt
November 2015 Dr. Ute Hillmer
Autonomist / Independent
Foto by merkapt
November 2015 Dr. Ute Hillmer
Security and Stability
Foto by merkapt
November 2015 Dr. Ute Hillmer
Entrepreneurial Creative
Foto by merkapt
November 2015 Dr. Ute Hillmer
Service and Goodwill
Foto by merkapt
November 2015 Dr. Ute Hillmer
Challenge and Variety
Foto by merkapt
November 2015 Dr. Ute Hillmer
Lifestyle
Foto by merkapt
November 2015 Dr. Ute Hillmer
Schein’sCareerAnchors
Adoptedforthe21stCentury
Chart by SR&A, Stuart Robertson
November 2015 Dr. Ute Hillmer
What Stereotype is
your „Ideal Customer“?
November 2015 Dr. Ute Hillmer
Learn about your
Target Market
November 2015 Dr. Ute Hillmer
Where to getAnswers
Quick Content Analysis: The right Product/Problem
description
1. Google Search with your key words from this morning
2. Google Adwords / Keyword Planner
Detailed Content Analysis: What exactly are people
looking for?
1. Amazon Booktitel-Search
2. Amazon 3-Star Search
3. Google Analytics
Interviews: In-Depth Understanding
November 2015 Dr. Ute Hillmer
Task: Do a Google SearchAnalysis
Take your product/project description to Google Search
1. What wording does Google-Autofil suggest?
2. What topics, web-pages, blogs, companies come up
what is their wording?
what is their content?
Who is there?
3. Results:
– What are your new 2-4 keywords?
– Who are your 3-5 key competitors?
November 2015 Dr. Ute Hillmer
GoogleAdvanced Search
Video: https://www.youtube.com/watch?v=yc6ssZnCyuA
November 2015 Dr. Ute Hillmer
Why Google?
The Online Search Ecosystem 2013
November 2015 Dr. Ute Hillmer
Task: Do a GoogleAdWordsAnalysis
Take your product/project description to Google Adwords
1. Open Google Adwords (maybe register), go to → Tools
→ Keyword Planer
2. Enter your keywords and take notes:
Keyword mtl. Search Competition Price (CPC)
November 2015 Dr. Ute Hillmer
Task: Do theAmazon Booktitle Search
1. Start looking for book titles
2. What seems to be the core
concern of people interested
in this topic?
3. Modify the answers and the
wording in your workbook
based on your learnings
November 2015 Dr. Ute Hillmer
Task: Do theAmazon 3-Star Search
1. Look at the 3-Star
Reviews
2. What seems to be
the core concern of
people interested in
this topic? What are
they looking for and
praise or can’t find?
3. Make a list of the
core problems
people seem to
have
November 2015 Dr. Ute Hillmer
Now: What
do you
„Sell“
November 2015 Dr. Ute Hillmer
Your Ideal
Customer
November 2015 Dr. Ute Hillmer
Your Ideal Customer
This isn’t about your most common customer –
it’s about who you want as your most wanted
customer! The 20% that create 80% of your revenue.
If you have more than one ideal customer, create
multiple copies, but set a limit to 3-5 max.
Your most hungry customer!
November 2015 Dr. Ute Hillmer
Your Ideal Customer Profile - Outline
November 2015 Dr. Ute Hillmer
Your Ideal Customer Profile - Motivations
November 2015 Dr. Ute Hillmer
YourIdealCustomerProfile – BusinessGoals
November 2015 Dr. Ute Hillmer
YourIdealCustomerProfile – Narrative+ Letter
November 2015 Dr. Ute Hillmer
Positio-
ning
Foto: Pepe Laja
November 2015 Dr. Ute Hillmer
What is Positioning?
Positioning defines where your product or service stands in relation to others
offering similar products and services in the marketplace as well as the mind of
the consumer.
Positioning always starts with a “product” (merchandise, a service, a company, an
institution, or even a person….)
but positioning is not what you do to that product. Positioning is what you do to
the mind of the prospect or customer.
Positioning is the act of designing the company’s
offering and image to occupy distinctive place in
the mind of the target market.
Kottler Keller
November 2015 Dr. Ute Hillmer
What is Positioning?
Image by talk2frank from Stock.Xchng
November 2015 Dr. Ute Hillmer
What is Positioning good for?
Position, differentiate and communicate
Think from your customers perspective, before you talk to them
#1 Relevance – avoid price wars
Is the promised added value of relevance to your target segment? Does
your customer care?
#2 Differentiation – avoiding replicability
Are you unique? Do you offer something „more“ that what your customers
offer?
#3 everybody and everywhere, the message is the same
One core message from every employee + partner and through every
channel
November 2015 Dr. Ute Hillmer
Value
Proposition
Foto: Pepe Laja
November 2015 Dr. Ute Hillmer
A brand’s value
proposition is the set
of benefits or values it
promises to deliver to
customers to satisfy
their needs.
Choosing a Value Proposition
Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong 2014
November 2015 Dr. Ute Hillmer
Value proposition is the #1 thing that
determines whether people will bother
reading more about your product or hit the
back button. It’s also the main thing you
need to test – if you get it right, it will be a
huge boost.
Why choosing a Value Proposition
A VP explains the bottom line of what
your company does
http://conversionxl.com/
November 2015 Dr. Ute Hillmer
AValue Proposition is
a promise of value to be delivered. It’s the primary
reason a prospect should buy from you.
In a nutshell, value proposition is a clear statement that
explains how your product
• solves customers’ problems or improves their situation
(relevancy),
• delivers specific benefits (quantified value),
• tells the ideal customer why they should buy from you
and not from the competition (unique differentiation).
It’s for people to read and understand!
http://conversionxl.com/
November 2015 Dr. Ute Hillmer
What a ValueProposition isnot
It’s not a slogan or a catch phrase:
L’Oréal. Because we’re worth it.
Nike: Just do it
It’s not a positioning statement (positioning statement is a
subset of a value proposition, but it’s not the same thing):
Germany’s #1 Skin Care.
Trusted skincare for life.
And a bad example of a Value Proposition:
“Revenue-focused marketing automation & sales effectiveness
solutions unleash collaboration throughout the revenue cycle”
http://conversionxl.com/
November 2015 Dr. Ute Hillmer
AValue Proposition Consists of
• a block of text (a headline, sub-headline and one paragraph of
text) with a visual (photo, hero shot, graphics).
There is no one right way to go about it, but I suggest you start with
the following formula:
• Headline. What is the end-benefit you’re offering, in 1 short
sentence. Can mention the product and/or the customer. Attention
grabber.
• Sub-headline or a 2-3 sentence paragraph. A specific
explanation of what you do/offer, for whom and why is it useful.
• 3 bullet points. List the key benefits or features.
• Visual. Images communicate much faster than words. Show the
product, the hero shot or an image reinforcing your main message.
http://conversionxl.com/
November 2015 Dr. Ute Hillmer
Create a Good Value Proposition
• A key role for the value proposition is to set you apart
from the competition. Most people check out 4-5 different
options / service providers before they decide. You want your
offering to stand out in this important research phase.
• How do you make your offer unique? Often it’s hard to spot
anything unique about your offering. It requires deep self-
reflection and discussion.
• If you can’t find anything, you better create something. Of
course the unique part needs to be something customers
actually care about. No point being unique for the sake of
being unique (“the ball bearings inside our bicycles are blue”).
http://conversionxl.com/
November 2015 Dr. Ute Hillmer
Use the Right Language
• Your value proposition needs to be in the language
of the customer. It should join the conversation that
is already going on in the customer’s mind.
• You cannot guess what that language is. The way
YOU speak about your services is often very
different from how your customers describe it.
http://conversionxl.com/
November 2015 Dr. Ute Hillmer
• BMW promises “the ultimate driving machine”
• Nissan Leaf electric car is “100% electric. Zero gas. Zero tailpipe.”
• New Balance’s Minimus shoes are “like barefoot only better.”
• Vibram FiveFingers shoes: “You are the technology.”
• Facebook helps you “connect and share with the people in your life”
• YouTube “provides a place for people to connect, inform, and
inspire others across the globe.”
Useful Value Proposition Examples
Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong 2014
November 2015 Dr. Ute Hillmer
Examples of Value Propositions in Crowded
Markets: Sell a Customer Experience!
Car Repair Shop
• Simple fix for blown head gaskets
• Repairs blown head gaskets in just one hour
Domino Pizza
• “You get fresh, hot pizza, delivered to you in under 30
minutes – or it’s free!”
http://conversionxl.com/
November 2015 Dr. Ute Hillmer
Customer Experiences Online Buyers want
• Low Prices (38%)
• Shopping Convenience
(35.1%)
• Easy To Compare
(33.1%)
• Free Shipping (31.5%)
• Time Saving (30.8%)
• Easy To Buy (29.2%)
• Range of Products
(17.4%)
Infographic by Invesp (sources data from eMarketer and Internetretailer.com)
Don’t take these things at face value, because not everything
is as it seems. Ask your customers or test it
November 2015 Dr. Ute Hillmer
• USP (Unique Selling Proposition). USP is the most closely related concept. It’s often considered
synonymous with value proposition (especially in relation to copywriting). But it only focuses on
what makes your product better than competing options. And that’s just a part of a strong value
proposition.
• FAB (Feature-Advantage-Benefit). FAB is a process that helps you figure out what each of your
product’s features means to your customers, which enables you to address their concerns,
desires, wants, and needs. You start by listing your product’s features (e.g., stainless steel as the
material of a knife). Then consider what advantages it creates (it won’t corrode). And finally turn
that into the practical benefit (you don’t need to buy a new knife every year).
• POP-POD (Points of Parity – Points of Difference). POP-POD is a process used to find
differentiating factors between businesses. You start by finding “points of parity,” or the factors
you have in common with your competitors. And then you find “points of difference;” the aspects
of your business thatdifferentiate you from your competitors.
• UVP (Unique Value Proposition). UVP sounds nearly the same as value proposition. But the
strong focus on uniqueness makes it less useful (much like USP).
ValueProp-USP-FAB-POP-POD-UVP
November 2015 Dr. Ute Hillmer
Value Proposition Canvas
Products &
Services
• Welche Produkte oder
Dienstleistungen helfen dem Kd.
seinen funktionalen, sozialen oder
emotionalen Job zu machen. Was stillt
Bedürfnisse?
• Produkte in Kundenprio setzen.
Gain creators
• Wir ermöglichen Produkte oder
Dienstl. Chancen (funktional, sozial,
emotional, monetär)
Pain-Reliefers
• Wie verhindern oder verringern d.
Produkte/Dienstl. Kunden-Schmerzen
(funktional, sozial, emotional,
monetär)
Job-to-be-done
Welchen Job (funktional, sozial,
emotional) versuchen die Zielkunden zu
erledigen:
• Welche Aufgaben erledigen sie
• Welches Problem versuchen sie zu
lösen?
• Welche Bedürfnisse versuchen sie zu
erfüllen?
Pains
• Welche negativen Gefühle,
unerwünschte Kosten oder
Situationen, welche Risiken können
vor, während oder nach
Aufgabenerledigung aufkommen
Gains
• Welche Vorteile erwartet, wünscht der
Kunde (funktional, sozial, emotional,
monetär)
Value Proposition Customer Segment(s)
based on: businessmodelgeneration.com
November 2015 Dr. Ute Hillmer
Value Proposition Canvas Video
https://www.youtube.com/watch?v=gB-YwlBrVVs
November 2015 Dr. Ute Hillmer
Your Customer‘s Job
Thetasksyour
targetcustomer
has(fornow,forget
thebuyingcenter)
What urgent
needs do they
have?
What are their
Compelling
desires?
…
…
…
…
November 2015 Dr. Ute Hillmer
What are the
• largestwinsyoucan gainforourcustomer
• thebiggestbenefit,customerscanobtain?
• Biggestpainswecanofferrelieffor?
…
November 2015 Dr. Ute Hillmer
The biggest result
Determine the biggest result your customers get
… it must be a big one!
What is your big promise?
People buy results and the
benefits they get from
these results
November 2015 Dr. Ute Hillmer
Whenand how do you keepour promisses?
When were your
customers really
happy?
Why?
What was the right
fit?
…
…
November 2015 Dr. Ute Hillmer
What product(s) do we offer?
…
November 2015 Dr. Ute Hillmer
Task:
Lead your Project to
Huge Success:
• Position your project innovation with the VP Canvas
- 30 Min each one individually
- Discuss it in teams of 3 (20 Min each)
• Present your Value Proposition (1 Min each)
November 2015 Dr. Ute Hillmer
Our promise (1)
We help…
…
…
November 2015 Dr. Ute Hillmer
Our promise (2)
What we help our customers do is:
…
…
…
November 2015 Dr. Ute Hillmer
Our promise (3)
Why we do what we do to serve our customers:
…
Our Vision, what we hope to achieve:
…
November 2015 Dr. Ute Hillmer
Our Promise (4)
How we differenciate from alternatives in the
market
…
November 2015 Dr. Ute Hillmer
Positionierung: Value Proposition
• Operative excellence
• Product excellence
• Customer insight
Youhaveachoice:
economic
benefits
emotional
benefits
functional
benefits
November 2015 Dr. Ute Hillmer
Value Proposition
We help …
(do the following things) …
in order to …
November 2015 Dr. Ute Hillmer
Task:
Builtthe ValuePropositionfürYour PSAProject
November 2015 Dr. Ute Hillmer
Tomorrow:
Designing a Customer Driven
Marketing Strategy in an Online
World
Production
concept
Product
concept
Selling
concept
Marketing
concept
Societal
Marketing
concept
November 2015 Dr. Ute Hillmer
Suggested Reading
• Value Proposition Design by A. Osterwalder, Y.Pigneur
• Groundswell by Charlene Li, Josh Bernoff
• Positioning by Trout and Ries
• In Pursuit of Wow! + The Tom Peters Seminar by Tom Peters
• What would Google do by Jeff Jarvis
• All Marketeers tell Stories by Seth Godin
• 1 to 1 Marketing Future by Don Peppers
• CRM at the Speed of light by Paul Greenberg
• The Long Tail by Chris Anderson
• The Wisdom of Crowds by James Surowiecki
• Crossing the Chasm by Geoffery Moore
• Selling the Dream by Guy Kawasaki
November 2015 Dr. Ute Hillmer
November 2015 Dr. Ute Hillmer
Dankeschön!
175 von EndSeitenzahl
HERZLICHEN DANK FÜR
IHRE AUFMERKSAMKEIT!
GIBT ES FRAGEN?
© 2015 School of International Business and Entrepreneurship (SIBE) der Steinbeis-Hochschule Berlin I www.steinbeis-sibe.de I Dr. Ute Hillmer

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! Customer driven marketing 151204

  • 1. November 2015 Dr. Ute Hillmer ACustomer Driven Marketing Strategy: Creating and capturing CUSTOMER VALUE in an Online/Offline World “Ourageofanxietyistheresultof doingtodaysjobswithyesterdays technology“ M.McLuhan
  • 2. November 2015 Dr. Ute Hillmer WHO is Dr. Ute Hillmer? anexpertinpositioningandpromotingtechnology products,withacarvingforinnovativeproductsthat arenotself-explaining. Withsuchproducts,humanbehaviorisoftenoutsidethe boundariesofrationality-despiteitseconomiccontext. Buyingbehaviorisheretypicallyaresultofsocial,cognitive andemotionalfactors,alongwiththeeconomicones.
  • 3. November 2015 Dr. Ute Hillmer What did Ute do? • 27 years of international marketing (HP, CoCreate, MFG Innovation Agency State of BW, Better Reality Marketing) • Dissertation in business administration, behavioral economics in technology marketing: Technology Acceptance in Mechatronics • Worldwide company and product communication; mainly 3 continents (America, Europe, Asia) • Product-, program-, channel-, partner marketing, marketing communication, branding, positioning • Responsible for operative, strategic + corporate marketing, branding, sales training • Experienced in large corporations, SMEs and freelance work as well as political institutions. • Responsible for the first international website of Hewlett Packard in 1993
  • 4. November 2015 Dr. Ute Hillmer What’s Ute’s STORY?Iaminbusinessto change thelivesofmytechnology clientsbyfindingthem hungrycustomers that get them intosustainablegrowth!
  • 5. November 2015 Dr. Ute Hillmer and turn their customers into raving fans!
  • 6. November 2015 Dr. Ute Hillmer To take the most out of this lecture … be in STATE!
  • 7. November 2015 Dr. Ute Hillmer Agenda1. Marketing Today: the new Buying Decision Process 2. Creating and Capturing Customer Value 3. Your Ideal Customer 4. Positioning for the Ideal Customer 5. Create your Value Proposition Creating and capturing CUSTOMER VALUE!
  • 8. November 2015 Dr. Ute Hillmer Marketing + Sales Today: a New Buying Decision Process
  • 9. November 2015 Dr. Ute Hillmer Role-play to discover: “Has Marketing changed?” “Must Marketing change?”
  • 10. November 2015 Dr. Ute Hillmer Funnel-Metaphor for a Buying Decision active evaluation many brands Grafik close to Edelman 2010 buying decision Initial considerationTrigger lesser and lesser brands What brand creates the most value to me/us right now and in the future?
  • 11. November 2015 Dr. Ute Hillmer Digitally supported Buying Decision active Evaluation Post-Sales Experience Enlarged Evaluation Ambassador Loyalty Loop Active Evaluation Model close to Edelman 2010, p.65 Moment of Purchase Initial Consideration Trigger What brand creates the most value to me/us right now and in the future?
  • 12. November 2015 Dr. Ute Hillmer Information Sources Today The 2014 B2B Buyer Behaviour Survey
  • 13. November 2015 Dr. Ute Hillmer 2014 B2B Buyer Behavior Survey • Web search is the top source of information • B2B buyers strategically browse social media • The number of sources used to research and evaluate purchase has increased • There is an increased awareness of purchase options • The evaluation process is longer and more satisfying DemandGen Report Survey 2014
  • 14. November 2015 Dr. Ute Hillmer What Role does Social Media Play? The 2014 B2B Buyer Behaviour Survey
  • 15. November 2015 Dr. Ute Hillmer The Core Consequences 1. Consumers and buyers connect with brands in fundamentally new ways – often beyond manufacturers’ or dealers' control. 2. They evaluate a shifting array of options during the evaluation process and remain engaged with the brand after purchase. 3. Customers can have as much information and knowledge, as vendors do. Its no longer about “information” it’s about creating and capturing CUSTOMER VALUE! You need a customer driven marketing strategy!
  • 16. November 2015 Dr. Ute Hillmer Customer Driven Marketing – What does that mean?
  • 17. November 2015 Dr. Ute Hillmer From Product- Focus to Customer Focus Product Price Place Promotion Customer Needs Customer Cost Convenience / Access Communication McCarthy: Basic Marketing: A managerial approach, 1960 Schullz, Stanley I. Tannenbaum, Robert F. Lauterborn, Integrated Marketing Communications, 1993
  • 18. November 2015 Dr. Ute Hillmer From Product- Focus to Customer Focus • Making a sale • Abundance of products in the nearby shopping centers • Television, magazine, and direct-mail ads • Satisfying customer needs • Imaginative Web sites and mobile phone apps, blogs, online videos, and social media • Reach customers directly, personally, and interactively Traditional View Contemporary View Kotler, Armstrong 2014
  • 19. November 2015 Dr. Ute Hillmer Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong 2014 Marketing: Creating Customer Value and Engagement Amazon.com’s deep-down passion for creating customer engagement, value, and relationships has made it the world’s leading online retailer. Amazon has become the model for companies that are obsessively and successfully focused on delivering customer value.
  • 20. November 2015 Dr. Ute Hillmer • Objective 1: Understand the fundamental change in marketing • Objective 2: Identify the key elements of a customer-driven marketing strategy • Objective 3: Apply the steps of a customer driven marketing strategy to your project Learning Objectives Marketing: Creating Customer Value and Engagement
  • 21. November 2015 Dr. Ute Hillmer TheAim of Marketing • Marketing involves creating value for customers and building strong customer relationships in order to capture value from customers in return. • Goals: – Attract new customers by promising superior value – Keep and grow current customers by delivering satisfaction – influence the buyer and buying center in the place and at the moment when they are most open on their way to brand choice and a buying decision Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong 2014
  • 22. November 2015 Dr. Ute Hillmer The Marketing Process Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong 2014 What is a prerequisite to create Customer Value?
  • 23. November 2015 Dr. Ute Hillmer Customer Needs, Wants and Demands Understanding the Marketplace and Customer Needs • States of felt deprivation • Physical needs - food, clothing, warmth, and safety • Social needs - belonging and affection • Individual needs - knowledge and self-expression Needs • Form taken by human needs when shaped by culture and individual personality Wants • Human wants that are backed by buying power Demands Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong 2014
  • 24. November 2015 Dr. Ute Hillmer • Identify the key elements of a customer-driven marketing strategy and discuss the marketing management orientations that guide marketing strategy. Designing a Customer Value-Driven Marketing Strategy Preparing an Integrated Marketing Plan and Program Learning Objective Marketing: Creating Customer Value and Engagement Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong 2014
  • 25. November 2015 Dr. Ute Hillmer This is a 2 Day Work Session on Customer-Driven Marketing Strategy Day 1: Designing a Customer Value-Driven Marketing Strategy 1. Selecting customers to serve – Find your Ideal Customer 2. Creating value for these selected customers – Define the Value Proposition Day 2: Effectively communicate Customer Value – Define a (digital) launch plan Applying the 20/80 rule to this marketing lecture …
  • 26. November 2015 Dr. Ute Hillmer What does that mean for you: Market + sell YOUR PROJECT in your Internal and/or External Market
  • 27. November 2015 Dr. Ute Hillmer • What is your business goal for the PSA 3? • What is your business goal for the Master Thesis? • What is so important about the goal? • Why is it important? • Ultimately, what would having that do for you? Task: Your WHY! Write it down on a sheet of paper for you!
  • 28. November 2015 Dr. Ute Hillmer PSA3:GoalDefinition+ Communication Planning
  • 29. November 2015 Dr. Ute Hillmer Creating Value for Customers • Market Segmentation • Targeting • Differentiation • Positioning Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong cartoon: fotalia
  • 30. November 2015 Dr. Ute Hillmer ContrastingSellingandMarketingConcepts Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong
  • 31. November 2015 Dr. Ute Hillmer Marketing Management in a Customer Driven Marketing Strategy Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong 2014
  • 32. November 2015 Dr. Ute Hillmer Designing a Customer Value-Driven Marketing Strategy Marketing Management is the art and science of choosing target markets and building profitable relationships with them. – What customers will we serve? – How can we best serve these customers? Market Segmentation refers to dividing the markets into segments of customers. Target Marketing refers to which segments to go after. 1. Selecting Customers to Serve Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong 2014
  • 33. November 2015 Dr. Ute Hillmer Task: What do you „Sell“
  • 34. November 2015 Dr. Ute Hillmer Segmenting a Market
  • 35. November 2015 Dr. Ute Hillmer What is Market Segmentation? Market segmentation requires dividing a market into smaller segments with distinct needs, characteristics, or behaviors that might require separate marketing strategies or mixes. Kottler, Armstrong 2014 Segmentation is used to identify and further define your ideal customer
  • 36. November 2015 Dr. Ute Hillmer • Segmenting consumer markets? • Segmenting business markets? • Segmenting international markets? • Effective segmentation? Criterias for
  • 37. November 2015 Dr. Ute Hillmer Segmenting Consumer Markets • The big 4 Geographic segmentation Demographic segmentation Psychographic segmentation Behavioral segmentation Copyright © 2016 Pearson Education, Inc.
  • 38. November 2015 Dr. Ute Hillmer GeographicSegmentation RegionsfollowingACNielsen Geographic segmentation divides the market into different geographical units such as nations, regions, states, counties, cities, or even neighborhoods.
  • 39. November 2015 Dr. Ute Hillmer DemographinSegmentation Sinusmilieu Demographic segmentation divides the market into segments based on variables such as age, life-cycle stage, gender, income, occupation, education, religion, ethnicity, and generation.
  • 40. November 2015 Dr. Ute Hillmer DemographinSegmentation Age,Gender,Income,… Age and life-cycle stage segmentation divides a market into different age and life-cycle groups. Gender segmentation divides a market into different segments based on gender. Income segmentation divides a market into different income segments.
  • 41. November 2015 Dr. Ute Hillmer PsychographicSegmentation Sinusmilieu Psychographic segmentation divides a market into different segments based on social class, lifestyle, or personality characteristics.
  • 42. November 2015 Dr. Ute Hillmer BehavioralSegmentation Behavioral segmentation divides a market into segments based on consumer knowledge, attitudes, uses of a product, or responses to a product. • Occasions • Benefits sought • User status • Usage rate • Loyalty status Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong
  • 43. November 2015 Dr. Ute Hillmer Task: Consumer Market Segmentation for GoPro
  • 44. November 2015 Dr. Ute Hillmer Discussion on Segmenting Consumer vs. Business Markets
  • 45. November 2015 Dr. Ute Hillmer Segmenting Business Markets • Consumer and Business have many of the same segmenting variables. Additional variables include: Customer Operating Characteristics Situational Factors Purchasing Approaches Personal Characteristics Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong Geographic segmentation Demographic segmentation Psychographic segmentation Behavioral segmentation
  • 46. November 2015 Dr. Ute Hillmer Segmenting International Markets Geographic location Economic factors Political and legal factors Cultural factors Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong
  • 47. November 2015 Dr. Ute Hillmer Intermarket segmentation involves forming segments of consumers who have similar needs and buying behaviors even though they are located in different countries. 7-21 Segmenting International Markets Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong
  • 48. November 2015 Dr. Ute Hillmer Task: Market Segmentation for UPS
  • 49. November 2015 Dr. Ute Hillmer Requirements for Effective Segmentation Measurable Accessible Substantial Differentiable Actionable Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong
  • 50. November 2015 Dr. Ute Hillmer When Segmenting Markets, watch out for: Measurability • “otherwise the scheme will not be operational” • next to impossible in some markets, hard in most markets => most companies use qualitative and intuitive methods Substantiality • “the variable should be relevant to a substantial group of customers” • Challenge: find the right size / balance: large group segment: risk of diluting effectiveness • Too small: you lose the benefits of economies of scale • Sometime one large customer Operational Relevance (Actionable) • Segmentation should enable to offer the suitable product/service to the chosen segment, e.g. faster delivery service, special 24-hour technical support, etc. Source: Webster, 2003
  • 51. November 2015 Dr. Ute Hillmer Market Targeting
  • 52. November 2015 Dr. Ute Hillmer Selecting Target Market Segments . . . . .. . . A target market is a set of buyers who share common needs or characteristics that the company decides to serve.
  • 53. November 2015 Dr. Ute Hillmer Undifferentiated marketing targets the whole market with one offer • Mass marketing • Focuses on common needs rather than what’s different Copyright © 2016 Pearson Education, Inc. Selecting Target Market Segments
  • 54. November 2015 Dr. Ute Hillmer Differentiated marketing targets several different market segments and designs separate offers for each. • Goal is to achieve higher sales and stronger position • More expensive than undifferentiated marketing Selecting Target Market Segments Copyright © 2016 Pearson Education, Inc.
  • 55. November 2015 Dr. Ute Hillmer Concentrated marketing targets a large of a smaller market • Limited company resources • Knowledge of the market • More effective and efficient Selecting Target Market Segments Copyright © 2016 Pearson Education, Inc.
  • 56. November 2015 Dr. Ute Hillmer Micromarketing is the practice of tailoring products and marketing programs to suit the tastes of specific individuals and locations. • Local marketing • Individual marketing Selecting Target Market Segments Copyright © 2016 Pearson Education, Inc.
  • 57. November 2015 Dr. Ute Hillmer Local marketing involves tailoring brands and promotion to the needs and wants of local customer segments. • Cities • Neighborhoods • Stores Copyright © 2016 Pearson Education, Inc. 7-32 Selecting Target Market Segments Copyright © 2016 Pearson Education, Inc.
  • 58. November 2015 Dr. Ute Hillmer Individual marketing involves tailoring products and marketing programs to the needs and preferences of individual customers. • Also known as: – One-to-one marketing – Mass customization Selecting Target Market Segments Copyright © 2016 Pearson Education, Inc.
  • 59. November 2015 Dr. Ute Hillmer Choosing a targeting strategy depends on • Company resources • Product variability • Product life-cycle stage • Market variability • Competitor’s marketing strategies Selecting Target Market Segments Copyright © 2016 Pearson Education, Inc.
  • 60. November 2015 Dr. Ute Hillmer Socially Responsible Target Marketing • Benefits customers with specific needs • Concern for vulnerable segments Selecting Target Market Segments Copyright © 2016 Pearson Education, Inc.
  • 61. November 2015 Dr. Ute Hillmer • What different market segment strategies are of relevance in your master thesis project? • What are 3-5 relevant market segments that you could target in your internal and/or external communication? • Prioritize your market segments and make a short note on your decision criteria. Task: Your Market Segmentation
  • 62. November 2015 Dr. Ute Hillmer Segmenting by Buying (User) Behavior
  • 63. November 2015 Dr. Ute Hillmer Consumer buyer behavior is the buying behavior of final consumers—individuals and households that buy goods and services for personal consumption. Consumer markets are made up of all the individuals and households that buy or acquire goods and services for personal consumption. Consumer Markets and Buyer Behavior Copyright © 2016 Pearson Education, Inc.
  • 64. November 2015 Dr. Ute Hillmer Model of Consumer Behavior Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong
  • 65. November 2015 Dr. Ute Hillmer 5-10 CharacteristicsAffecting Consumer Behavior Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong
  • 66. November 2015 Dr. Ute Hillmer Business Markets and Business Buyer Behavior Business buyer behavior refers to the buying behavior of the organizations that buy goods and services for use in the production of other products and services that are sold, rented, or supplied to others. The business buying process is the process where business buyers determine which products and services are needed to purchase, and then find, evaluate, and choose among alternative brands. Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong
  • 67. November 2015 Dr. Ute Hillmer Business buyers usually face more complex buying decisions than do consumer buyers. Compared with consumer purchases, a business purchase usually involves: • More decision participants • More professional purchasing effort • More buyer and seller interaction The Buying Unit Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong
  • 68. November 2015 Dr. Ute Hillmer MajorTypes of Buying Situations Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong
  • 69. November 2015 Dr. Ute Hillmer User Typologies „Personas“
  • 70. November 2015 Dr. Ute Hillmer Archtypes: Roger’s InnovationAdopter Categories Foto by: ehoyerEverett Rogers, 1995 “Diffusion of Innovations”
  • 71. November 2015 Dr. Ute Hillmer Time Marketsize technology life cycle and its buyer categories Laggards 16% Late Majority 34% Early Adopters 13,5% Early Majority 34% Innovators 2,5% Chart based on Rogers 1995, p. 262 and Moore 1999, p. 12
  • 72. November 2015 Dr. Ute Hillmer Persona: Techy Time Marketsize Laggards 16% Late Majority 34% Early Adopters 13,5% Early Majority 34% Innovators 2,5% Chart based on Rogers 1995, and Moore 1999
  • 73. November 2015 Dr. Ute Hillmer Time Marketsize Laggards 16% Late Majority 34% Early Adopters 13,5% Early Majority 34% Innovators 2,5% Persona: Visionary Chart based on Rogers 1995, and Moore 1999
  • 74. November 2015 Dr. Ute Hillmer Time Marketsize Laggards 16% Late Majority 34% Early Adopters 13,5% Early Majority 34% Innovators 2,5% Persona: Pragmatist Chart based on Rogers 1995, and Moore 1999
  • 75. November 2015 Dr. Ute Hillmer Time Marketsize Laggards 16% Late Majority 34% Early Adopters 13,5% Early Majority 34% Innovators 2,5% Persona: Conservative Chart based on Rogers 1995, and Moore 1999
  • 76. November 2015 Dr. Ute Hillmer Time Marketsize Laggards 16% Late Majority 34% Early Adopters 13,5% Early Majority 34% Innovators 2,5% Personas: Laggard Chart based on Rogers 1995, and Moore 1999
  • 77. November 2015 Dr. Ute Hillmer LaggardsLate Majority Early Adopters Early Majority Innovators Mainstream Behaviour Increasingly conforming behaviour Hillmer, Technology Acceptance in Mechatronics, 2009 Zeit Marktgröße
  • 78. November 2015 Dr. Ute Hillmer LaggardsLate Majority Early Adopters Early Majority Innovators Individualistic Behaviour Increasingly individualistic behaviour Zeit Marktgröße Hillmer, Technology Acceptance in Mechatronics, 2009
  • 79. November 2015 Dr. Ute Hillmer Archtypes: Schein’s CareerAnchors Foto by: ehoyer Edgar H. Schein, 2006 “Career Anchors”
  • 80. November 2015 Dr. Ute Hillmer Technical / Fictional Competence Foto by merkapt
  • 81. November 2015 Dr. Ute Hillmer General Management Competence Foto by merkapt
  • 82. November 2015 Dr. Ute Hillmer Autonomist / Independent Foto by merkapt
  • 83. November 2015 Dr. Ute Hillmer Security and Stability Foto by merkapt
  • 84. November 2015 Dr. Ute Hillmer Entrepreneurial Creative Foto by merkapt
  • 85. November 2015 Dr. Ute Hillmer Service and Goodwill Foto by merkapt
  • 86. November 2015 Dr. Ute Hillmer Challenge and Variety Foto by merkapt
  • 87. November 2015 Dr. Ute Hillmer Lifestyle Foto by merkapt
  • 88. November 2015 Dr. Ute Hillmer Schein’sCareerAnchors Adoptedforthe21stCentury Chart by SR&A, Stuart Robertson
  • 89. November 2015 Dr. Ute Hillmer What Stereotype is your „Ideal Customer“?
  • 90. November 2015 Dr. Ute Hillmer Learn about your Target Market
  • 91. November 2015 Dr. Ute Hillmer Where to getAnswers Quick Content Analysis: The right Product/Problem description 1. Google Search with your key words from this morning 2. Google Adwords / Keyword Planner Detailed Content Analysis: What exactly are people looking for? 1. Amazon Booktitel-Search 2. Amazon 3-Star Search 3. Google Analytics Interviews: In-Depth Understanding
  • 92. November 2015 Dr. Ute Hillmer Task: Do a Google SearchAnalysis Take your product/project description to Google Search 1. What wording does Google-Autofil suggest? 2. What topics, web-pages, blogs, companies come up what is their wording? what is their content? Who is there? 3. Results: – What are your new 2-4 keywords? – Who are your 3-5 key competitors?
  • 93. November 2015 Dr. Ute Hillmer GoogleAdvanced Search Video: https://www.youtube.com/watch?v=yc6ssZnCyuA
  • 94. November 2015 Dr. Ute Hillmer Why Google? The Online Search Ecosystem 2013
  • 95. November 2015 Dr. Ute Hillmer Task: Do a GoogleAdWordsAnalysis Take your product/project description to Google Adwords 1. Open Google Adwords (maybe register), go to → Tools → Keyword Planer 2. Enter your keywords and take notes: Keyword mtl. Search Competition Price (CPC)
  • 96. November 2015 Dr. Ute Hillmer Task: Do theAmazon Booktitle Search 1. Start looking for book titles 2. What seems to be the core concern of people interested in this topic? 3. Modify the answers and the wording in your workbook based on your learnings
  • 97. November 2015 Dr. Ute Hillmer Task: Do theAmazon 3-Star Search 1. Look at the 3-Star Reviews 2. What seems to be the core concern of people interested in this topic? What are they looking for and praise or can’t find? 3. Make a list of the core problems people seem to have
  • 98. November 2015 Dr. Ute Hillmer Now: What do you „Sell“
  • 99. November 2015 Dr. Ute Hillmer Your Ideal Customer
  • 100. November 2015 Dr. Ute Hillmer Your Ideal Customer This isn’t about your most common customer – it’s about who you want as your most wanted customer! The 20% that create 80% of your revenue. If you have more than one ideal customer, create multiple copies, but set a limit to 3-5 max. Your most hungry customer!
  • 101. November 2015 Dr. Ute Hillmer Your Ideal Customer Profile - Outline
  • 102. November 2015 Dr. Ute Hillmer Your Ideal Customer Profile - Motivations
  • 103. November 2015 Dr. Ute Hillmer YourIdealCustomerProfile – BusinessGoals
  • 104. November 2015 Dr. Ute Hillmer YourIdealCustomerProfile – Narrative+ Letter
  • 105. November 2015 Dr. Ute Hillmer Positio- ning Foto: Pepe Laja
  • 106. November 2015 Dr. Ute Hillmer What is Positioning? Positioning defines where your product or service stands in relation to others offering similar products and services in the marketplace as well as the mind of the consumer. Positioning always starts with a “product” (merchandise, a service, a company, an institution, or even a person….) but positioning is not what you do to that product. Positioning is what you do to the mind of the prospect or customer. Positioning is the act of designing the company’s offering and image to occupy distinctive place in the mind of the target market. Kottler Keller
  • 107. November 2015 Dr. Ute Hillmer What is Positioning? Image by talk2frank from Stock.Xchng
  • 108. November 2015 Dr. Ute Hillmer What is Positioning good for? Position, differentiate and communicate Think from your customers perspective, before you talk to them #1 Relevance – avoid price wars Is the promised added value of relevance to your target segment? Does your customer care? #2 Differentiation – avoiding replicability Are you unique? Do you offer something „more“ that what your customers offer? #3 everybody and everywhere, the message is the same One core message from every employee + partner and through every channel
  • 109. November 2015 Dr. Ute Hillmer Value Proposition Foto: Pepe Laja
  • 110. November 2015 Dr. Ute Hillmer A brand’s value proposition is the set of benefits or values it promises to deliver to customers to satisfy their needs. Choosing a Value Proposition Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong 2014
  • 111. November 2015 Dr. Ute Hillmer Value proposition is the #1 thing that determines whether people will bother reading more about your product or hit the back button. It’s also the main thing you need to test – if you get it right, it will be a huge boost. Why choosing a Value Proposition A VP explains the bottom line of what your company does http://conversionxl.com/
  • 112. November 2015 Dr. Ute Hillmer AValue Proposition is a promise of value to be delivered. It’s the primary reason a prospect should buy from you. In a nutshell, value proposition is a clear statement that explains how your product • solves customers’ problems or improves their situation (relevancy), • delivers specific benefits (quantified value), • tells the ideal customer why they should buy from you and not from the competition (unique differentiation). It’s for people to read and understand! http://conversionxl.com/
  • 113. November 2015 Dr. Ute Hillmer What a ValueProposition isnot It’s not a slogan or a catch phrase: L’Oréal. Because we’re worth it. Nike: Just do it It’s not a positioning statement (positioning statement is a subset of a value proposition, but it’s not the same thing): Germany’s #1 Skin Care. Trusted skincare for life. And a bad example of a Value Proposition: “Revenue-focused marketing automation & sales effectiveness solutions unleash collaboration throughout the revenue cycle” http://conversionxl.com/
  • 114. November 2015 Dr. Ute Hillmer AValue Proposition Consists of • a block of text (a headline, sub-headline and one paragraph of text) with a visual (photo, hero shot, graphics). There is no one right way to go about it, but I suggest you start with the following formula: • Headline. What is the end-benefit you’re offering, in 1 short sentence. Can mention the product and/or the customer. Attention grabber. • Sub-headline or a 2-3 sentence paragraph. A specific explanation of what you do/offer, for whom and why is it useful. • 3 bullet points. List the key benefits or features. • Visual. Images communicate much faster than words. Show the product, the hero shot or an image reinforcing your main message. http://conversionxl.com/
  • 115. November 2015 Dr. Ute Hillmer Create a Good Value Proposition • A key role for the value proposition is to set you apart from the competition. Most people check out 4-5 different options / service providers before they decide. You want your offering to stand out in this important research phase. • How do you make your offer unique? Often it’s hard to spot anything unique about your offering. It requires deep self- reflection and discussion. • If you can’t find anything, you better create something. Of course the unique part needs to be something customers actually care about. No point being unique for the sake of being unique (“the ball bearings inside our bicycles are blue”). http://conversionxl.com/
  • 116. November 2015 Dr. Ute Hillmer Use the Right Language • Your value proposition needs to be in the language of the customer. It should join the conversation that is already going on in the customer’s mind. • You cannot guess what that language is. The way YOU speak about your services is often very different from how your customers describe it. http://conversionxl.com/
  • 117. November 2015 Dr. Ute Hillmer • BMW promises “the ultimate driving machine” • Nissan Leaf electric car is “100% electric. Zero gas. Zero tailpipe.” • New Balance’s Minimus shoes are “like barefoot only better.” • Vibram FiveFingers shoes: “You are the technology.” • Facebook helps you “connect and share with the people in your life” • YouTube “provides a place for people to connect, inform, and inspire others across the globe.” Useful Value Proposition Examples Copyright © 2016 Pearson Education, Inc.. Kotler, Armstrong 2014
  • 118. November 2015 Dr. Ute Hillmer Examples of Value Propositions in Crowded Markets: Sell a Customer Experience! Car Repair Shop • Simple fix for blown head gaskets • Repairs blown head gaskets in just one hour Domino Pizza • “You get fresh, hot pizza, delivered to you in under 30 minutes – or it’s free!” http://conversionxl.com/
  • 119. November 2015 Dr. Ute Hillmer Customer Experiences Online Buyers want • Low Prices (38%) • Shopping Convenience (35.1%) • Easy To Compare (33.1%) • Free Shipping (31.5%) • Time Saving (30.8%) • Easy To Buy (29.2%) • Range of Products (17.4%) Infographic by Invesp (sources data from eMarketer and Internetretailer.com) Don’t take these things at face value, because not everything is as it seems. Ask your customers or test it
  • 120. November 2015 Dr. Ute Hillmer • USP (Unique Selling Proposition). USP is the most closely related concept. It’s often considered synonymous with value proposition (especially in relation to copywriting). But it only focuses on what makes your product better than competing options. And that’s just a part of a strong value proposition. • FAB (Feature-Advantage-Benefit). FAB is a process that helps you figure out what each of your product’s features means to your customers, which enables you to address their concerns, desires, wants, and needs. You start by listing your product’s features (e.g., stainless steel as the material of a knife). Then consider what advantages it creates (it won’t corrode). And finally turn that into the practical benefit (you don’t need to buy a new knife every year). • POP-POD (Points of Parity – Points of Difference). POP-POD is a process used to find differentiating factors between businesses. You start by finding “points of parity,” or the factors you have in common with your competitors. And then you find “points of difference;” the aspects of your business thatdifferentiate you from your competitors. • UVP (Unique Value Proposition). UVP sounds nearly the same as value proposition. But the strong focus on uniqueness makes it less useful (much like USP). ValueProp-USP-FAB-POP-POD-UVP
  • 121. November 2015 Dr. Ute Hillmer Value Proposition Canvas Products & Services • Welche Produkte oder Dienstleistungen helfen dem Kd. seinen funktionalen, sozialen oder emotionalen Job zu machen. Was stillt Bedürfnisse? • Produkte in Kundenprio setzen. Gain creators • Wir ermöglichen Produkte oder Dienstl. Chancen (funktional, sozial, emotional, monetär) Pain-Reliefers • Wie verhindern oder verringern d. Produkte/Dienstl. Kunden-Schmerzen (funktional, sozial, emotional, monetär) Job-to-be-done Welchen Job (funktional, sozial, emotional) versuchen die Zielkunden zu erledigen: • Welche Aufgaben erledigen sie • Welches Problem versuchen sie zu lösen? • Welche Bedürfnisse versuchen sie zu erfüllen? Pains • Welche negativen Gefühle, unerwünschte Kosten oder Situationen, welche Risiken können vor, während oder nach Aufgabenerledigung aufkommen Gains • Welche Vorteile erwartet, wünscht der Kunde (funktional, sozial, emotional, monetär) Value Proposition Customer Segment(s) based on: businessmodelgeneration.com
  • 122. November 2015 Dr. Ute Hillmer Value Proposition Canvas Video https://www.youtube.com/watch?v=gB-YwlBrVVs
  • 123. November 2015 Dr. Ute Hillmer Your Customer‘s Job Thetasksyour targetcustomer has(fornow,forget thebuyingcenter) What urgent needs do they have? What are their Compelling desires? … … … …
  • 124. November 2015 Dr. Ute Hillmer What are the • largestwinsyoucan gainforourcustomer • thebiggestbenefit,customerscanobtain? • Biggestpainswecanofferrelieffor? …
  • 125. November 2015 Dr. Ute Hillmer The biggest result Determine the biggest result your customers get … it must be a big one! What is your big promise? People buy results and the benefits they get from these results
  • 126. November 2015 Dr. Ute Hillmer Whenand how do you keepour promisses? When were your customers really happy? Why? What was the right fit? … …
  • 127. November 2015 Dr. Ute Hillmer What product(s) do we offer? …
  • 128. November 2015 Dr. Ute Hillmer Task: Lead your Project to Huge Success: • Position your project innovation with the VP Canvas - 30 Min each one individually - Discuss it in teams of 3 (20 Min each) • Present your Value Proposition (1 Min each)
  • 129. November 2015 Dr. Ute Hillmer Our promise (1) We help… … …
  • 130. November 2015 Dr. Ute Hillmer Our promise (2) What we help our customers do is: … … …
  • 131. November 2015 Dr. Ute Hillmer Our promise (3) Why we do what we do to serve our customers: … Our Vision, what we hope to achieve: …
  • 132. November 2015 Dr. Ute Hillmer Our Promise (4) How we differenciate from alternatives in the market …
  • 133. November 2015 Dr. Ute Hillmer Positionierung: Value Proposition • Operative excellence • Product excellence • Customer insight Youhaveachoice: economic benefits emotional benefits functional benefits
  • 134. November 2015 Dr. Ute Hillmer Value Proposition We help … (do the following things) … in order to …
  • 135. November 2015 Dr. Ute Hillmer Task: Builtthe ValuePropositionfürYour PSAProject
  • 136. November 2015 Dr. Ute Hillmer Tomorrow: Designing a Customer Driven Marketing Strategy in an Online World Production concept Product concept Selling concept Marketing concept Societal Marketing concept
  • 137. November 2015 Dr. Ute Hillmer Suggested Reading • Value Proposition Design by A. Osterwalder, Y.Pigneur • Groundswell by Charlene Li, Josh Bernoff • Positioning by Trout and Ries • In Pursuit of Wow! + The Tom Peters Seminar by Tom Peters • What would Google do by Jeff Jarvis • All Marketeers tell Stories by Seth Godin • 1 to 1 Marketing Future by Don Peppers • CRM at the Speed of light by Paul Greenberg • The Long Tail by Chris Anderson • The Wisdom of Crowds by James Surowiecki • Crossing the Chasm by Geoffery Moore • Selling the Dream by Guy Kawasaki
  • 138. November 2015 Dr. Ute Hillmer
  • 139. November 2015 Dr. Ute Hillmer Dankeschön!
  • 140. 175 von EndSeitenzahl HERZLICHEN DANK FÜR IHRE AUFMERKSAMKEIT! GIBT ES FRAGEN? © 2015 School of International Business and Entrepreneurship (SIBE) der Steinbeis-Hochschule Berlin I www.steinbeis-sibe.de I Dr. Ute Hillmer