KINE 4430 - 2009

Marketing Class # 3*PLACE – Distribution Strategy*Social Marketing* Sponsorship

Reviewing the OutputsThe outputs of the marketing plan process

- Types of distribution- Distribution strategies (consumer & business)

- Types of promotion- Promotional strategies

(consumer & business)

- Price Elasticity (Sensitivity)- Pricing strategies

(lifecycle/product type)- Pricing policies

Product PromotionPricing

Marketing Mix Elements

Place

- Product types- Product tangibility- Product lifecycle

- New product development

Analytic Tools:

• Research• Balance & Gaps Assessment

• Measurement, Monitoring & Evaluation

Marketing Objectives & Strategy

Business Location Decision

• Two major factors:1. What your customer believes is the “best

location”

2. Your distribution channel—the method or way in which a producer makes a product or service available to the consumer

Distribution Channels

PRODUCERProducer

Consumer Segment

#1

Retailers

Consumer Segment

#2

Distributors

Dealers

Business Segment

#1

Business Segment

#2

Distribution Strategy

• Your distribution strategy will depend on a number of factors, such as:Target Customer needsType of businessProduct/service characteristicsTransportation costsCompetition

The “Best” Location

___Local/municipal licensing___Neighbourhood mix___Competition___Security, safety___Labour pool___Services___Costs___Ownership___Property owner/landlord___Past tenants___Space___Accessibility___Professional advice

___Local/municipal licensing___Neighbourhood mix___Competition___Security, safety___Labour pool___Services___Costs___Ownership___Property owner/landlord___Past tenants___Space___Accessibility___Professional advice

___Parking___History of the property___Physical visibility___Life-cycle stage of the area ___Image___Hours of operation___Utilities___Local zoning by-laws___Taxes___Approvals___Transportation___ Your target customers

___Parking___History of the property___Physical visibility___Life-cycle stage of the area ___Image___Hours of operation___Utilities___Local zoning by-laws___Taxes___Approvals___Transportation___ Your target customers

•A location filter or checklist will help you zero in on the “perfect” location•Use a scale of 1 to 10 to rate the relative importance of each item on this list. When you finish scoring, go back and note the high numbers anything above 5.

Is Home the “Best” Place?Potential

DisadvantagesPotential

Advantages Low risk of expensive mistakes Opportunity to use household

resources Low overhead Gradual start-up and growth No commuting time or expense Tax advantages (with

deductions allowed for part of the house)

Relatively inexpensive way to test a market

Reduced child-care costs Increased quality time with

family

Isolation and lack of contact

with colleagues Increased family stress Need for self-discipline Local by-laws and regulations Less established or refined

image Conflict with neighbours Parking problems

Before You Sign Checklist Escape clause Escape clause

Option to renew Option to renew

Right to transfer Right to transfer

Cost-of-living Cost-of-living

Percentage lease Percentage lease

Floating rent sale Floating rent sale

Start-up buffer Start-up buffer

Improvement Improvement

Restrictive covenants Restrictive covenants

Maintenance Maintenance

CAUSE OR SOCIAL MARKETING

Strengthens business relationships - customers & general public

Addresses social issues of concern to target market

Increases sales

Builds a Brand image

Lessons for Socially Responsible Companies

• What you sell is important: both the mission and the product should be socially responsible

• Be proud to be in business: profit not a dirty word

• Make a solid commitment to change: business is natural outgrowth of social entrepreneur’s values

• Focus on two bottom lines: viable company + social mission

• Forget the hype: socially responsible companies lead by doing good deeds, not by promoting them

Source: Thea Singer, “Can Business Still Save the World?”Inc., April 30, 2001, pp58-71; and MEC website, www.mec.ca

Environmentalism

• Environmentalism:– An organized movement of concerned citizens and

government agencies

– To protect and improve people’s living environment

• Environmental sustainability:– Management approach

– Develop strategies that both sustain the environment and produce Company ‘s profits

Socially Responsible Marketing

• Enlightened marketing:– A marketing philosophy that holds

– A company’s marketing should support the– Best long-run performance of the

marketing system

• Five principles:– Consumer-oriented marketing

– Innovative marketing

– Value marketing

– Sense-of-mission marketing

– Societal marketing

Ethical Issues Associated with Marketing

• Marketing research:– Invalid or unreliable research studies

– Invasion of consumer privacy, not respecting confidentiality

– Disguising sales as research

– Failure to secure voluntary and informed participation

– Competitive intelligence gathering

• Segmentation/target marketing:– Redlining: discriminating against poor

or disadvantaged consumers

– Targeting inappropriate products to vulnerable audiences

Ethical Issues Associated with Marketing

• Positioning:– Making socially undesirable products more desirable

– Positioning on questionable benefits

• Product:– Marketing unsafe products

– Product testing: on animals or insufficient testing

– Marketing socially controversial products

• Packaging and labeling:– Actual versus apparent size

– Misleading or inadequate information

– Excessive or environmentally-unfriendly packaging

Ethical Issues Associated with Marketing

• Pricing:– Collusion with competitors

– Negative option billing

– Prejudice in negotiated prices

– Price discrimination

• Advertising:– Sex role stereotyping

– Dehumanizing images and portraying people as products

– Bait-and-switch advertising

Seller’s Versus Consumers’ Rights

Sellers’ rights:– To introduce products of

different styles and sizes, provided they are not hazardous

– To set its own prices, provided no discrimination occurs

– To spend to promote the product

– To use any product message, provided it is not misleading

– To use buying incentives

Consumers’ rights:– To choose

– To be informed

– To safety

– To be heard

– To redress

– To consumer education

– To participate in marketplace decision making

– To have access to basic services

– To a sustainable environment

Canadian Marketing Association Code of Ethics

• Topics covered:– Application and governing legislation

– Accuracy of representation

– Disclosure, comparisons, guarantees, and warranties

– Fulfillment practices

– Media-specific standards of practice

– Product safety

– Marketing to children

– Protection of the environment

– Protection of personal privacy

– Enforcement procedures

Table 4.4

SPONSORSHIP MEDIUM

1ST AMPLIFY the Message

2nd AIM the Message

-marketers zero in on a “captured” TM-minimizes inefficiencies of communication process

EFFECTIVE SPONSORSHIPServes 4 constituent groups

Business interest of Sponsoring Company

Best interests of Event & Participants

Positive impact on Sponsor’s direct customers (dealers & retailers)

Benefit to Consumers who buy those products.

BUSINESS STRATEGIES & Sponsorship

1. CommunicatingSponsors communicate using sport as the communication medium

2. Targeting

Sponsorship effective for targeting clusters of consumers

3. Differentiating

“Image Enhancement” “Value Added” “Product Differentiation”

Gives Brand a unique & memorable attribute so it’s different from competitors

Villain Products – cigarette & alcohol use image enhancement

ADVANTAGES of SPONSORSHIP

1. CREATES IDENTITY

2. INCREASES SALES

3. PROMOTES business- to-business contacts

4. CONSTITUENT benefits

5. BUSINESS customers

“Interacting with consumers on an Emotional level”

Exposes people to product in environment encompassing their lifestyle or aspiring lifestyle

OLYMPIC GAMES SPONSORSHIP

• One of world’s oldest & most respected Brands• Represents the best in amateur sport• Encourages global co-operation, peace & harmony• Captures spirit & enthusiasm of virtually every

nation• Most recognized symbol (90% consumer

awareness)

Corporate Interests in the Olympic Rings

• Signature property

• Community engagement

• Employee engagement

• Product/ service showcase

• Media relations

• Customer hospitality

Opportunities with Canadian-hosted Games

As an emotional touch point, the Olympics creates a unique set of circumstances for companies to engage Canadians directly.

Vancouver Olympics 2010 Challenge is creating & sustaining high level of awareness

from the outset

Responsibilities of VANOC

To plan, organize, finance & stage the 2010 Winter Games

To protect the Olympic Brand in Canada

Has custodianship of Olympic & Paralympic Brands

The Olympic and Paralympic Marks Act

Specifically protects Olympic Brand in Canada (obligation to IOC)

Enables VANOC to protect exclusive rights granted to its marketing partners

Ensures Canada is aligned with International Community in granting special protection for Olympic/Paralympic brand

THE EXCHANGE

• Official sponsors, licensees & government partners significantly invest to ensure successful staging of 2010 Winter Games and funding to Canadian athletes

• Exclusive right to access marks, images, & stories that make Olympic & Paralympic Brand a sought after marketing tool

Ambush Marketing

Form of marketing used by certain commercial bodies to capitalize on “Goodwill of Olympic Movement” (+ the Games & Athletes) without making the financial investment required to secure official sponsorship rights.

Protecting the Olympic Brand in Canada

• VANOC’s Infringement Assessment

• Infringement of brand?

• Misleading business association?• 6 factors – factually accurate use, relevant use,

commercially neutral, undue prominence, use of Olympic or Paralympic visuals, unauthorized association