Break Free from the PLC

Product Life Cycle is a powerful concept which is instrumental in deciding most of companies’ marketing and positioning strategies, helping them to manage their offerings at different stages of their product (introduction, growth, maturity and decline).

But over the years this method has become quite mundane and more than often ensures all companies are perceived in almost identical manner by customers.

Following are the three different strategies used to rejuvenate products already in the maturity stage of PLC and going down the hill(towards decline stage). By using these strategies company try to revive fortunes of floundering products(pushing them back from maturity stage to growth stage) and also launch new products directly into growth stage rather than starting with introduction stage.

1. Reverse Positioning: Rather than continually augmenting the value proportion because all other companies are trying to woo their consumers this way, a company tries to reposition it self in its consumer’s psyche. Under this strategy company stops to augment its product, rather it keeps its product feature to bare minimum and provides some very distinguishing attributes that would typically be found only in highly augmented product. An underlying assumption here is that consumers don’t want a slew of features in a product; all they want is a basic product with highly differentiating attribute. This strategy is most suitable for service sector, where a consumer is unable to differentiate services rendered by different companies and end up not appreciating the augmentation brought forward to the services. Proliferating service options rather than delighting consumer tend to get them confused.

IKEA,Commerce Bank,JetBlue

2. Breakaway Positioning: Under this strategy a company rather than projecting its product as a member of one club, starts associating itself with altogether a different category. Each product is perceived in a certain manner by consumer and depending on the perception and cues he also forms an opining about its frequency of usage, timing of usage etc. To change any kind of preconceived notion that a consumer may harbor about the product, company try to disrupt the product category altogether so that to change the perception of consumer about the product. Company tries to affiliate itself with altogether a new category so as to shift product backward on PLC. Such kind of strategies is especially popular with companies dealing in packaged goods.. Unlike in case of services sector, consumers welcome augmentation of the product, but such products soon end up being basic products.
   

Swatch,The Simpsons,EZ Squirt Ketchup

3. Stealth Positioning: Sometimes customers are apprehensive of certain products. Customers may be intimidated by the product category, may not be having good past experiences or they may have their own personal reservations. In such cases a company tries to conceal true nature of their product by affiliating its product with a different category. In this manner company tries to gain acceptance by sneaking its product into market which may otherwise be quite difficult. This strategy is generally employed in case of products perceived as being difficult to use, unreliable and threatening.

Eye Toy,AIBO,Mac Mini

The peak-end rule

The theory is known as “peak-end rule,” as expressed by Noble Prize-winning psychologist Daniel Kahneman, describes the way that people remember events by the peak and the end of the experience.

According to the peak-end rule, we judge our past experiences almost entirely on how they were at their peak (pleasant or unpleasant) and how they ended. Virtually all other information appears to be discarded, including net pleasantness or unpleasantness and how long the experience lasted.

For instance, if I go to an amusement park, this heuristic says that I will remember my trip by the height of excitement and the way I felt when I left. The classic experiment showing this phenomenon is described by Mr. Schwartz:

Participants in a laboratory study were asked to listen to a pair of very loud, unpleasant noises played through their headphones. One noise lasted for eight seconds. The other lasted sixteen. The first eight seconds of the second noise were identical to the first noise, whereas the second eight seconds, while still loud and unpleasant, were not as loud. Later, the participants were told that they would have to listen to one of the noises again, but that they could choose which one. Clearly the second noise is worse–the unpleasantness lasted twice as long. Nonetheless, the overwhelming majority of people chose the second to be repeated.

So, the peak-end rule is a vital one to bear in mind when designing your customer experience. Does it tail off at the end or is there a positive, strong end-of-experience event that sticks in people’s minds.

Some customer gurus say the first seven seconds are absolutely crucial. Why ‘seven’ I don’t know. And the old adage ‘first impressions count’ plus Malcolm Gladwell’s research for his book Blink, that says we make up our minds about things in split seconds, would tend to argue that you should focus when designing your customer experience on three critical points, not just the two that Kahneman finds. So, think ‘beginning-peak-end’ when designing the customer experience.

The Evolution of personal selling

Firms who rely on personal selling for their marketing success will survive and prosper to the extent they adjust their selling practices to fit the contingencies and market environment they face.

There are 5 stages in personal selling. Their characteristics are as follows

Stage and description	Customer needs are	Type of market	Nature and intensity of competition	Examples
1.Provider: Accepting and delivering to buyer.	Assumed to exist.	Sellers	None	Sales people drivers.
2.Persuader: Attempting to convince anyone to buy available offerings.	Created, awakened	Buyers	Undifferentiated, slight intensity	Tele marketer.
3.Prospector: Seeking out prospects with need for available offering as well as resources and authority to buy.	Considered but inferred	Segmented	Differentiated and growing	Car insurance salespeople calling on new car buyers.
4. Problem solver: Matching available offerings to solve customer stated problems.	Diagnosed with attention to customer input.	Participative	Responsive and counter active with increasing resources.	Communication systems salespeople for telephone company.
5.Procreator: Creating a unique offering to match customers’ needs as mutually specified involving any or all aspects of the sellers’ total marketing mix.	Mutually defined: matched with tailored offering	Co active	Focused: growing in breadth of market and service offerings	Materials handling equipment sales person who designs and sells a system to fit a buyers manufacturing facility.

Analysis and Critique

As a company’s sales force advances through these stages of evolution, it also seems clear that the terms “personal selling” and “salesperson” are more and more unrepresentative of what this function and these people really are. While “selling” might be broadly interpreted as encompassing the various tasks of the problem solver and the procreator, it is more likely that persons in this stage those stages are taking on enlarged responsibilities typically included under marketing and management. Advanced stages of personal selling are evolving into marketing and management positions with their mission to benefit each buyer while improving the firm’s profit.

When we look at the various stages in personal selling, it is sometimes seen that companies practice the same according to the type of situation that arises with prospective customers. Depending on the current mindset of the customers the stages are interlinked and intertwined in order to achieve the final goal: which is to bring about mutual benefit. Hence practicing concrete transition between stages will not work all the time. Each type of business requires a different kind mix between stages of personal selling.

This classification might help the firm reassess its selling strategy, thereby making it understand the circumstances under which each stage in the personal selling process is practiced. Personal selling is not the key to success for every company. Each company needs to first analyze the market and its competitors in order to make the management decision of whether personal selling is right for them or not.

The different stages can also be linked to B2C and B2B marketing. The last two stages involve more of the business transaction where the seller and the buyer sit together and chalk out their exact needs and tailor the product/service accordingly. Whereas in B2C it might involve more of a pull strategy where the consumer might jus need a small impetus to go on and purchase/use the product.

DAGMAR

• Defining Advertising goals for measured advertising results.
  

• A model for Marketing Communications developed by Colley in 1961.
  

1) Unawareness of the Product

2) Awareness as a result of Advertising- Customer knows about the brand

3) Comprehension - recognition and understanding of the product

4) Conviction - Firm attitude towards the brand- the development of preference for the brand

5) Action - move towards purchase

• The effectiveness of the advertising campaign is eveluated by its movement along the spectrum
  

• DAGMAR allows for the cumulative impact of the advert.
  

• It is rare for a single advert to hav the power to move the consumer from Unawareness to Action.

AIEDA	Lavidge and Steiner	DAGMAR
Attention Interest Evaluation Desire Action	Awareness Knowledge Liking Preference Purchase	Unawareness Awareness Comprehension Conviction Action

Aaker’s Brand Identity Planning Model

David A. Aaker, a marketing professor at the University of California at Berkeley and author of the popular Building Strong Brands (1996), has developed a comprehensive brand identity planning model. At the heart of this model is a four-fold perspective on the concept of a brand. To help ensure that a firm’s brand identity has texture and depth, Aaker advises brand strategists to consider the brand as:
1) a product; 2) an organization; 3) a person; and 4) a symbol.

Each perspective is distinct. The purpose of this system is to help brand strategists consider different brand elements and patterns that can help clarify, enrich and differentiate an identity. A more detailed identity will also help guide implementation decisions.

As suggested by Aaker’s elaborate brand taxonomy, brand identity consists of a core identity and an extended identity. The former represents the timeless essence of the brand. It’s central to both the meaning and success of the brand, and contains the associations that are most likely to remain constant as the brand encompasses new products and travels to new markets. The extended identity, on the other hand, includes elements that provide texture and completeness. It fills in the picture, adding details that help portray what the brand stands for. A reasonable hypothesis, Aaker states, is that within a product class, a larger extended identity means a stronger brand—one that is more memorable, interesting and connected to customers’ lives.

Sometimes it is more purposeful to set a more narrow approach that determines brand essence, which is an idea, entailing brand soul. J Kapferer (2003) states that brand essence originated from a wish to generalize brand identity and positioning. Brand essence includes the principal value that is offered (for example, Volvo is the safest car).

The Brand Gap

How to bridge the distance between business strategy and design

Advertising and the Seven Sins of Memory

Imperfections in memory have obvious implications for the successful processing of advertising. Even if a positive intent is achieved through an advert, a memory malfunction can ruin it all for the marketer.

The Sin of Transience
Forgetting something that naturally occurs over time may be thought of as transience. This implies that people 'recall' from advertising is much more likely to reflect a generic description of what is expected about a brand rather than the specific benefits that are a part of the message.

encourage more elaborative encoding to help reduce transience is to relate information that target audience is interested in remembering with something they already know.

The Sin of Absent-Mindedness
Absent mindedness manifests itself both failing to remember past experiences as well as failing to remember to do something in the future.
Because on is more likely to pay partial attention rather full attention to advertising , familiarity with the advert is more likely than the specifics. Spaced exposures generally result in better memory.

The Sin of Blocking
All-too familiar experience of recognizing someone but not being able to remember their name. This is blocking. An association with the encoded information in the brain is not made. It is also what can lead to remembering of a product name but not a brand name.
Have benefits unique to a brand name to enable better association.

The Sin of Misattribution
If one correctly remembers something learned, but attributes it to the wrong source. 'unconscious transference'
Benefit must be linked to the brand- memory linking

The Sin of Suggestibility
Occurs when one tends to include information that has been learned from an outside source as something personally experienced.
This sin in the world of advertising might actually come as a blessing. Advertising that utilises questions that remind people of a favourable brand association could occasion a 'memory' for that positive experience, even if it never occurred.

The Sin of Bias
This sin reflects how currnt understandings, beliefs and feelings have the ability to distort how one interprets new experiences and the memory of them.

• Contingency and change bias
• Hindsight bias
• Egocentric bias

Include personal references in advertising and other marketing communication.

The Sin of Persistence
Emotionally charged experiences are better remembered than less emotional occasions. The sin of persistence involves remembering things you wish you would forget, and it is strongly associated with one's emotional experiences.
Emotionally-charged information automatically attracts attention, and even in the briefest exposure, the emotional memory will encode information.

Disaggregate Marketing

The shift in focus from brands to customer relationships has radical implications
for several internal processes and structures.

Example: Kraft Foods e-magazine: Foods & Family

Processes	Brand Management	Disaggregate Marketing
Organization Structure and Leadership	Managers or teams are assigned to product categories or brands. Product or brand manager.	Managers or teams are assigned to segments of similar consumers. Segment Manager
Key Business Resources	Success is measured by volume of sales, dollar sales, market share and brand or product profitability.	Success is measured by customer-level or segment-level profitability and depth of relationship (share of wallet)
New Product development and innovation	Developing and testing of products based on product-related competencies. Given our resources, what else can we make?	Developing and testing products on the basis of segment needs. What else does this customer segment require? What else can we deliver to them as a part of the complete solution?
Key Brand Management Activities	Brand-led copy development: brand level promotional activities to boost volume or market share; trade marketing support; coordination with advertising agency.	Segment driven cross-promotional opportunities; coordination of communication of multiple brands; integration and presentation of product portfolio as complementary solution set; segment analysis and development on the basis of consumer data.
Training	Focus is on developing marketing skills; branding, message development, agency management.	Focus is on developing knowledge of consumer segment, consumer behaviour, and the data interpretation and management.