GROUP 3 REPORTING...

Marketing
Challenges for
Entrepreneurial
Ventures
GROUP 3 REPORTING...

Objectives:
1. To introduce the new marketing concept for entrepreneurs
2. To review the importance of marketing research for new
ventures
3. To identify the key elements of an effective market survey
4. To present factors that inhibit the use of marketing
5. To present the emerging use of social media marketing and
mobile marketing for entrepreneurial firms
6. To identify entrepreneurial tactics in marketing research
7. To examine the marketing concept: philosophy, segmentation,
and consumer orientation
8. To establish the areas vital to a marketing plan
9. To discuss the key features of a pricing strategy
10. To discuss pricing in the social media age
REPORTER: CABONEGRO, NORMANTED

The New Marketing

Concept for Entrepreneurs
The new marketing logic requires a fundamental rethinking of the old
rules that applied in a world of stability and control.

THE ERA OF GENERATION C

SHIFT FROM THE 4Ps TO THE 4Cs: (C stands for CONTENT)
Connected
From Product…......to Cocreated
Creative
From Promotion...to Communities
Collaborative
From Price……….......to Customizable Contextual
From Place……….......to Choice The customer is central to all effective
marketing activity

1
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The New Marketing

Concept for Entrepreneurs

2
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Common Elements in the Marketing

Skills of Great Entrepreneurs
1. They possess unique environmental insight, which they use to spot
opportunities that others overlook or view as problems.
2. They develop new marketing strategies that draw on their unique
insights. They view the status quo and conventional wisdom as
something to be challenged.
3. They take risks that others, lacking their vision, consider foolish.
4. They live in fear of being preempted in the market.
5. They are fiercely competitive.
6. They think through the implications of any proposed strategy,
screening it against their knowledge of how the marketplace
functions. They identify and solve problems that others do not even
3 recognize.
REPORTER: CABONEGRO, NORMANTED

Common Elements in the Marketing

Skills of Great Entrepreneurs
7. They are meticulous about details and are always in search of new
mm.competitive advantages in quality and cost reduction, however
.........tsmall.
8. They lead from the front, executing their management strategies
aaaaenthusiastically and autocratically. They maintain close information
aaaacontrol when they delegate.
9. They drive themselves and their subordinates.
10.They are prepared to adapt their strategies quickly and to keep
aaaaadapting them until they work. They persevere long after others
sssshave given up.
11. They have clear visions of what they want to achieve next. They can
4 aaaasee further down the road than the average manager can see.
REPORTER: CABONEGRO, NORMANTED

Marketing Terms
MARKET
A group of consumers (potential consumers) who
have purchasing power and unsatisfied needs.
A new venture will survive only if a market exists for
its product or service.

MARKETING RESEARCH
The gathering of information about a particular
market, followed by analysis of that information.
5
REPORTER: CABONEGRO, NORMANTED

Defining the Research

Purpose and Objectives
1. Identify where potential customers go to purchase the
good or service in question.
2. Identify why they choose to go there.
3. Identify the size of the market and how much of it can the
business capture.
4. Identify how the business compares with competitors.
5. Identify the impact the business’s promotion has on
customers.
6. Identify the types of products or services desired by
6 potential customers.
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Gathering Information
SECONDARY DATA
Information that has already been compiled.
Advantage: Less expensive and available
Disadvantages: Outdated, lacks specificity,
questionable validity
Sources: Internal and/or external sources
PRIMARY DATA
Information that is gathered specifically for the
research at hand.
Surveys
7
Experimentation
REPORTER: CABONEGRO, NORMANTED

Gathering Information

8
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Developing an Information-
Gathering Instrument
The questionnaire is the basic instrument for a survey. Several considerations for
designing a questionnaire:
Make sure each question pertains to a specific objective in line with the purpose
of the study.
Place simple questions first and difficult-to-answer questions later in the
questionnaire.
Avoid leading and biased questions.
Ask yourself: “How could this question be misinterpreted?” Reword questions to
reduce or eliminate the possibility that they will be misunderstood.
Give concise but complete directions in the questionnaire. Succinctly explain the
information desired, and route respondents around questions that may not
relate to them.
9 When possible, use scaled questions rather than simple yes or no questions.
REPORTER: CABONEGRO, NORMANTED

Quantitative vs. Qualitative

Marketing Research
QUANTITATIVE RESEARCH
Involves empirical assessments that work from numerical measurements
and analytical approaches to compare the results.
The researcher is an uninvolved observer so that the results are
“objective.”
Requires larger samples to be able to perform the statistical analyses.

QUALITATIVE RESEARCH
Requires smaller sample size as it involves the researcher into the
process and is able to delve deeper into the questions with the
respondents.
Relies less on analytical testing, and the researcher is engaged in the
10
process, the results are considered “subjective.”
REPORTER: CABONEGRO, NORMANTED

Interpreting and Reporting

Information
DATA ORGANIZED AND INTERPRETED IS INFORMATION.
Tables
Charts
Graphs
Descriptive statistics - Mean, Mode, Median

MARKET RESEARCH SUBJECT AREAS:

Sales
Distribution
Markets
Advertising
11
Products
REPORTER: CABONEGRO, NORMANTED

Inhibitors to Marketing
Research
Mistaken beliefs that inhibit the use of marketing research:
COST
Marketing research can be expensive
Affordable marketing techniques exist for smaller
companies.
COMPLEXITY
Quantitative aspects frighten many entrepreneurs.
Key concern is interpretation of the data.
Entrepreneurs can obtain advice and counsel from
12 specialists.
REPORTER: CABONEGRO, NORMANTED

Inhibitors to Marketing
Research
STRATEGIC DECISIONS
Some entrepreneurs feel that only major strategic decisions
need marketing research support.
Sales effort could be enhanced through research results.
IRRELEVANCY
Some entrepreneurs believe that marketing research data
either tell them what they already know or are irrelevant.
Data that confirm what is already known can be acted upon with
more confidence.
Indicated by these inhibitors, most of the reasons that
entrepreneurs do not use marketing research center on either
13
a misunderstanding of its value or a fear of its cost.
REPORTER: CABONEGRO, NORMANTED

Social Media Marketing

SOCIAL MEDIA MARKETING
The use of social networks, online communities, blogs, wikis, and
other online collaborative media tools for marketing purposes.

EFFECTIVE SOCIAL MEDIA MARKETING:

CREATE something of value with an event, a video, a tweet, or
a blog entry, that attracts attention and becomes viral in
nature.
ENABLE customers to promote a message themselves with
multiple online social media venues.
ENCOURAGE user participation and dialogue that fully
14 engages customers with online conversations.
REPORTER: CABONEGRO, NORMANTED

Key Distinctions of Social Media

Marketing
Useful distinctions between traditional marketing (4Ps) and social
media marketing (4Cs) based on the customer focused concept:
CONTROL VERSUS CONTRIBUTIONS
Social media marketing emphasizes audience contribution
and relinquishes organizational control over large parts of
the content.
TRUST BUILDING
Firms cannot fully control the content users create,
development of trusting relationships is required.
TWO-WAY COMMUNICATION
Social media creates an ongoing interactive conversation
15
between the firm and the customer.
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Key Distinctions of Social Media

Marketing

16
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Developing a Social Media

Marketing Plan
Critical steps for the entrepreneur to keep in mind:
Listen
Identify
Categorize
Appraise
Implement
Collaborate
Convert
17 Monitor
REPORTER: PALERMO, EUNICE

Mobile Marketing
Mobile marketing applications allow the creation and
exchange of user-generated content and a plethora of
marketing opportunities, such as text messaging, mobile
applications, and mobile advertising via Common mobile
computing devices including cell phones, PDAS, smartphones,
tablet PCs, and netbooks. Mobile marketing and the use of
social media are potentially more important than almost any
other type of marketing.
Mobile social media applications can be differentiated based
on location-sensitivity. The most sophisticated forms of mobile
social media applications are those that account for both time
18 and location simultaneously.
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Mobile Marketing

19
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Entrepreneurial Tactics in
Market Research
Entrepreneurs tend and need to sometimes become innovative with their
market research.
Entrepreneurial tactics include:
GUERILLA MARKETING - The use of unconventional tactics and unorthodox
practices applied to marketing research. The entrepreneur must thrive on
tapping into unutilized sources of information and collecting information in
very creative ways.
INSIGHTS IN ORDINARY PATTERNS - The entrepreneur needs to understand
that patterns emerge over time, so identifying and tracking them is
invaluable.
TECHNOLOGICAL TOOLS - technology can be extremely valuable to
entrepreneurs and their research efforts. Tracking software to see exactly
20 how a visitor to the firm's website behaves, what features are examined,
and how long they remain on the site, may be a viable tool.
REPORTER: PALERMO, EUNICE

Entrepreneurial Tactics in
Market Research
CUSTOMER OBSERVATION - insights can be gained from observing
situations as they occur. Observational approaches can take many
creative forms. They can be obtrusive, where the subject is aware that he
or she is being observed, or unobtrusive, where he or she is not aware.
WEB-BASED SURVEYS - these services help an entrepreneur to design a
survey, drop it into an established online questionnaire format, and post it
on a secure website. These web-based services will format the data and
provide the statistical analysis as well. Web-based surveys are inexpensive
and can reach very large numbers of people in a short period of time.
FOCUS GROUPS - small groups of potential customers (usually 6-10) for an
in-depth discussion about the new venture the entrepreneur is proposing
may be a valuable source of insights. Participants elaborate on their
21 feelings, beliefs, perceptions, and experiences with this new venture.
REPORTER: PALERMO, EUNICE

Entrepreneurial Tactics in
Market Research
LEAD USER RESEARCH - lead users are often experienced in a particular
field of endeavor and are driven to seek a solution to a problem they
recognize. The lead user approach would allow the entrepreneur to take
pieces of information from these experts about the future and combine
them in novel ways.
BLOG MONITORING - blog sites have produced a new source of market
research insights. A blog is a website that includes user-generated
content, typically on some focused topic where anyone can post opinions
or information allowing for interactive discussions.
ARCHIVAL RESEARCH - archives are a collection of records that have been
created or accumulated over time. Access to most archives is free and
the information is objective. They are a type of secondary information that
22 can reveal important insights to the creative researcher.
REPORTER: PALERMO, EUNICE

The Components of Effective

Marketing
MARKETING PHILOSOPHY
PRODUCTION DRIVEN PHILOSOPHY
is based on the belief you must “produce efficiently and worry about sales
later.” Production is the main emphasis; sales follow in the wake of
production.
SALES-DRIVEN PHILOSOPHY
it focuses on personal selling and advertising to persuade customers to
buy the company’s output. This philosophy often surfaces when an
overabundance of supply occurs in the market.
CONSUMER-DRIVEN PHILOSOPHY
it relies on research to discover consumer preferences, desires, and
needs before production actually begins. This philosophy stresses the need
23 for marketing research to better understand where or who a market is
and to develop a strategy targeted toward that group.
REPORTER: PALERMO, EUNICE

Three Major Factors Influence the

Choice of a Marketing Philosophy
COMPETITIVE PRESSURE
The intensity of the competition will many times dictate a new venture’s
philosophy.
ENTREPRENEUR’S BACKGROUND
The range of skills and abilities entrepreneurs possess varies greatly. Whereas
some have a sales and marketing background, others possess production and
operations experience. The entrepreneur’s strengths will influence the choice
of a market philosophy.
SHORT-TERM FOCUS
sometimes a sales-driven philosophy may be preferred due to a short-term
focus on “moving the merchandise” and generating sales. Although this focus
appears to increase sales, it also can develop into a hard-selling approach that
24 soon ignores customer preferences and contributes to a long-range
dissatisfaction.
REPORTER: PALERMO, EUNICE

Market Segmentation
The process of identifying a specific set of characteristics that
differentiate one group of consumers from the rest.
Demographic Variables
Age
Marital Status
Sex
Occupation
Income
Location
Benefit Variables, help to identify unsatisfied needs that exist within
this market.
Convenience
Cost
25 Style
Trends (depending on the nature of the particular new venture)
REPORTER: PALERMO, EUNICE

Consumer Behavior
CONSUMER BEHAVIOR
The types and patterns of consumer characteristics:
Personal characteristics
Psychological characteristics

Marketing experts have tied these characteristics to

the five types of consumers:
1. Innovators
2. Early Adaptors
3. Early Majority
4. Late Majority
26 5. Laggards
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Consumer Behavior

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Consumer Behavior

28
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Consumer Behavior

29
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Major Consumer Good

Classifications:
1. Convenience goods.
Whether staple goods (foods), impulse goods (checkout counter items), or
emergency goods and services, consumers will want these goods and services
but will not be willing to spend time shopping for them.
2. Shopping goods.
Products consumers will take time to examine carefully and compare for quality
and price.
3. Specialty goods.
Products or services consumers make a special effort to find and purchase.
4. Unsought goods.
Items consumers do not currently need or seek. Common examples are life
insurance, encyclopedias and cemetery plots. These products require
explanation or demonstration.
5. New Products
30 Items that are unknown due to lack of advertising or are new products that take
time to be understood.
REPORTER: CABARTEJA, JHO-ANN

Developing a Marketing Plan

MARKETING PLAN
The process of determining a clear, comprehensive approach to the
creation of customers.
ELEMENTS OF MARKETING PLAN
Current marketing research - determining who the customers
are, what they want, and how they buy.
Current sales analysis - promoting and distributing products
according to marketing research findings.
Marketing information system - collecting, screening, analyzing,
storing, retrieving, and disseminating marketing information on
which to base plans, decisions and actions.
Sales forecasting - coordinating personal judgment with reliable
market information.
Evaluation - identifying and assessing deviations from marketing
31
plans.
REPORTER: CABARTEJA, JHO-ANN

Developing a Marketing Plan

CURRENT MARKETING RESEARCH
The purpose of marketing research is to identify customers—
target markets—and to fulfill their desires.
AREAS OF MARKET RESEARCH:
The company’s major strengths and weaknesses - these
factors offer insights into profitable opportunities and potential
problems and provide the basis for effective decision making.
Market profile - it helps a company identify its current market
and service needs.
Current and best customers - Identifying the company’s
current clients allows management to determine where to
allocate resources. Defining the best customers enables
32 management to segment this market niche more directly.
REPORTER: CABARTEJA, JHO-ANN

Developing a Marketing Plan

Potential customers - by identifying potential customers-either
geographically or with an industry-wide analysis of its marketing
area-a company increases its ability to target this group, thus turning
potential customers into current customers.
Competition - a company can determine which firms are most willing
to pursue the same basic market niche.
Outside factors - this analysis focuses on changing trends in
demographics, economics, technology, cultural attitudes, and
governmental policy. These factors may have a substantial impact on
customer needs and, consequently, expected services.
Legal changes - marketing research performs the important task of
keeping management abreast of significant changes in governmental
33 rates, standards and task laws.
REPORTER: CABARTEJA, JHO-ANN

Current Sales Analysis

SALES RESEARCH QUESTIONS:
Do salespeople call on their most qualified prospects on a proper
priority and time-allocation basis?
Does the sales force contact decision makers?
Are territories aligned according to sales potential and
salespeople’s abilities?
Are sales calls coordinated with other selling efforts, such as
trade publication advertising, trade shows, and direct mail?
Do salespeople ask the right questions on sales calls? Do sales
reports contain appropriate information? Does the sales force
understand potential customers’ needs?
How does the growth or decline of a customer’s or a prospect’s
34 business affect the company’s own sales?
REPORTER: CABARTEJA, JHO-ANN

Marketing Information System

MARKETING INFORMATION SYSTEM
Compiles and organizes data relating to cost, revenue,
and profit from the customer base for monitoring the
strategies, decisions, and programs concerned with
marketing.
FACTORS AFFECTING THE VALUE OF A SYSTEM:
1. Data reliability
2. Data usefulness or understandability
3. Reporting system timeliness
4. Data relevancy
35 5. System cost
REPORTER: CABARTEJA, JHO-ANN

Marketing Planning
SALES FORECASTING
The process of projecting future sales through historical
sales figures and the application of statistical
techniques. The process is limited in value due to its
reliance on historical data, which many times fail to
reflect current market conditions.

EVALUATION
Evaluating marketing plan performance is important so
that flexibility and adjustment can be incorporated into
36 marketing planning.
REPORTER: CABARTEJA, JHO-ANN

The Market Plan: A Structured

Approach
STEP 1: Appraise marketing strengths and weaknesses,
emphasizing “competitive edge” factors.
STEP 2: Develop marketing objectives, along with short- and
intermediate-range sales goals.
STEP 3: Develop product/service strategies.
STEP.4: Develop marketing strategies to achieve
intermediate- and long-range sales goals and long-term
marketing objectives.
STEP 5: Determine a pricing structure.
37
REPORTER: CABARTEJA, JHO-ANN

Pricing Strategies
FACTORS AFFECTING THE PRICING DECISION OF
ENTREPRENEURS:
The degree of competitive pressure
The availability of sufficient supply
Seasonal or cyclical changes in demand
Distribution costs
The product’s life-cycle stage
Changes in production costs
Prevailing economic conditions
Customer services provided by the seller
The amount of promotion
38 The market’s buying power
REPORTER: CABARTEJA, JHO-ANN

Pricing Strategies
PSYCHOLOGICAL FACTORS AFFECTING THE PRICING DECISION:
The quality of a product is interpreted by customers
according to the level of the item’s price.
Customer groups shy away from purchasing a product where
no printed price schedule is available.
Emphasis on the monthly cost of purchasing an expensive item
results in greater sales than an emphasis on total selling price.
Buyers expect to pay even-numbered prices for prestigious
items and odd-numbered prices for commonly available
goods.
The greater the number of customer benefits the seller can
39 convey about a product, the less will be the price resistance.
REPORTER: CABARTEJA, JHO-ANN

Pricing Strategies
PRODUCT LIFE CYCLE PRICING

VIEWS OF PRICING
Value
Variable
Variety
Visible
Virtual

40
REPORTER: CABARTEJA, JHO-ANN

Pricing Strategies
PRICING IN THE SOCIAL MEDIA AGE
FREEMIUM MODEL - offers a basic service for free, while
charging for a premium service with advanced features to
paying members.
AFFILIATE MODEL - the business makes money by driving
traffic, leads, or sales to another, affiliated company’s website.
SUBSCRIPTION MODEL - this requires users to pay a fee
(generally monthly or yearly) to access a product or service.
VIRTUAL GOODS MODEL - users pay for virtual goods, such as
upgrades, points, or gifts, on a website or in a game.
ADVERTISING MODEL - advertisements are sold against the
41 traffic of the site.
Thank
You!