Understanding Customer’s Value Need and Value Communication
1.0. Understanding Customer’s Value Need
1.1. Market Research Concepts
1.1.1. The population of the city.
Kingston is a Canadian City that has been chosen for this study. The total population estimate of Canada on March 31, 2016 was 170,898 (Bidtnes, 2017). As compared to the census population taken in 2006 (152,358) and 2011 (159,561), the population 2016 has significantly increased.
1.1.2. The population of Kingston City by demographic characteristics
The population by age has been indicated in Table 1.As per the age, the highest population was at the age group for both male and females were between 50 and 54 years, where women were 13,289 people. On the other hand, the lowest population was of the people who were above 85 years whose total was 4,374 people. This data indicates that the life expectancy is still high for the residents of the city beyond 85 years.
In the broader perspective of ethnic background (Table 2), the city has diverse ethnic groups based on the responses on Statistics Canada. The total population by ethnic origin is 148,475 in 2016. The group with the highest population in the city is of the British Isles origin, while the least is the Americans. The people of the Canadian origin are ranked number four (52,220) after the British Isles origins, other North American origins, and English origins.
The data on the marital status (Table 3) in Kingston City for2016is based on Ontario’s data for the singles, married, separated, living common-law, widowed, and divorced with a total of 13,982, 984 people. The number of married people in the province is high (5,819,252) as compared to other marital groups. The total populations for the single, separated, living common law, widowed, and divorced were 5,499,703, 392,235, 860,216, 715,925, and 695,653 respectively. There is a narrow line between the number of married men and women who live in Ontario cities, and so does Kingston City. However, the data shows that more men go to the city to look for jobs to sustain their families than women.
Addition, the recent survey performed in 2016was used in the population highlights and analysis of Kingston City whose total population working was 881,000 (Table 4). The number of the unemployed people in the city is lower, meaning that Canada’s policy to reduce rates of unemployment has been successful in the city.
Table 5 represents the population by income for the people of age 15 years and above in 2016 in Kingston City. The data indicates that the total number of people aged above fifteen years was 145, 058, where 139,521 comprised those who belonged to income-earning class and 5,537 being those with no income in the city (Bidtnes, 2017). In this category, the median of the 2015 total income was $37,598, while the average was $48,204. Also, the median of the income for males in 2015 was $43,425 and the average amounting to $55,292. Additionally, the median of the income for the women in 2015 was $31,803, while the average was $41,691. Additionally, there were only 12,425 people over 15 years earning below $5,000, rest earned between $5000 and $125,000, and the remaining 3,657 people got a pay of over $125,000.
In Table 6 in the appendix, housing in Kingston City is measured based on the median home price which ($178,000) and the average people per household is 2.3. Notably, the median housing price in Kingston City is higher that of the entire Canada ($175,700). In this city, the owner occupied households is 44.5 percent. This percentage is lower than the overall Canadian owner occupied households which accounts for 64.4 percent. The results indicate that housing is relatively expensive in Kingston as compared to other cities in Canada.
Lastly, the population by education in 2016 Kingston is presented in Table 7 as shown in the appendix. The percentage of the people who have gone to school and aged over 15 years 61.1 percent, with 64.9 percent men and 57.5 women. People with more than bachelor’s degrees are higher than other groups (74 percent). These results depict that many people in Canada are learned especially in Kingston City.
The demographics of the whole Canadian population are that the population growth in terms of age, marital status, occupation, housing, education, income, and ethnic background has been increasing every year. The most significant aspect learned in this exercise is that the increase in the income earned by the population has enabled them to have improved living standards in the area.
In the review of all the information derived from the Statistics Canada Website, it has been possible for the marketers to develop the profiles of the city’s market segment or the marketing strategy. The first advantage of this data is that it provides the information on the income of the households which is useful in determining the potential customer base for a company (Statistics Canada, 2017). Secondly, the data helps them to know where the firm can distribute the products based on the area that has many people. Third, the marketers will be able to identify the marketing strategies to use based on the age, education, sex, and ethnic groups that have different preferences for the products and services. The fourth advantage the data gathered about the population is useful for the marketing team to develop the customer value models as it provides the firsthand information about the potential customers.
Nonetheless, the data collected has several disadvantages that the marketers need to consider while trying to understand the value need of the customers. In the first place, the information obtained does not show the customer value need relationships directly since it requires the marketers to perform a value assessment. The second limitation it cannot be possible to tell if the customers from the selected region will go for the products and services from a given company as opposed to those from its rivals. Thirdly, results from the assessment are as precise as when calculations were done to determine the ever changing needs of the population within the area. Lastly, the customer does not have any idea about the information which the marketers are looking for unless they are directed where to find it.
1.2 Consumer and Organizational Buying Behavior
1.2.1 The consumer decision-making process when deciding to purchase an Apple iPad
Recognition of the Need
The customer identifies a specified need for an Apple iPad service or the product he or she intends to buy (Kottler, 2009).
Search of Information
At this stage, the customers starting searching for the information of the service or products they have identified through print media, the internet, personal recommendations, and advertisements among other appropriate in-store experience (Solomon et al., 2010). On the other hand, Lamb et al. (2011) asserted that an organization selling the product could also search for the information in case it wishes to cross-sell or up-sell the products as one of the integrated campaigns of marketing.
Alternative Evaluation
The information collected helps the consumer evaluate the alternatives he or she needs to make on the basis of their personal interpretation. For instance, Solomon et al. (2010) argue that and the individual customer has a tendency of giving different personal weighting to different factors that have been collected in the course of the information search. Such aspect includes price, possible location, brand value, perceived value, and the speed of service.
Decision of Purchase
This phase of the decision process for a consumer of Apple iPad involves his or her decision concerning what he or she will buy and if they already have service or product perception that they are impressed with it. This idea has an implication that whenever they contemplate purchasing the same product or service, it is probable that they will go straight to the purchase decision (Solomon et al., 2010).
Evaluation of Purchase
This phase marks the end of the consumer decision-making process after buying the product or service. At this stage, the customers retrospectively perform an evaluation of their decision of purchase based on the initial assessment as well as the criteria of buying. Here is where they identify how far a product fulfills, exceeds, or fails to fulfill the expectations of the customers (Lamb et al., 2011). Solomon et al. (2010) pointed out that it is likely the consumers of repeat the purchase in the offing if the previous evaluation was positive. Thus, the completion of the decision process of the consumers of the iPad requires their retrospective evaluation of their purchase to see if the iPad meets their expectations and money value criteria or not.
1.2.2 Consumer decision-making process for an Apple iPad compared with the model in the textbook
In it, is an indisputable fact that consumers go through a complex process while making decisions concerning the type of services or products to buy, and the iPad consumer is not an exception. The customer model developed in this assignment was based on the Canadian population based on the marital status, age, income, education, occupation, and housing of iPad consumer. The data revealed that there are many single people in the city as compare to the married, divorced, separated, and widowed. These results depict many singles are youths who have a sophisticated lifestyle as compared to the married people (Kotler, 2009). Thus, this lifestyle is a cornerstone for their need recognition that the company needs to take into account. For instance, such group could buy many iPads since because of its sophisticated appearance and features.
In the context of the information search, the younger people between 20 and 34 years is the age that has not only attained post-secondary education but also can access the information easily on the internet, unlike the younger and older people. Therefore, such group of the population has high chances making decisions of buying the products and services of Apple after getting the information they require concerning the product as mentioned in the textbook (Kottler & Armstrong, 2010).
Based on the alternative evaluation, the data on the population of Canada was also used to analysis the decisions the customers would make concerning the Apple’s iPad. In this case, the data on the income, age, and marital status was important based on the significance of the country of origin, Canada. The findings indicate that many singles as compared to married people, meaning that they are higher evaluators of the consumer alternatives in Canada. Additionally, the population with high income tends to have a greater evaluation of the product alternatives as opposed to the low-income earners. Also, younger people are more likely to view the product as an evaluation criterion which is less crucial as compared to the older people.
The model in the paper is also related to the decision of purchase stage of the consumer decision-making process based on which population group would decide to purchase the iPad from Apple Inc. but not in other stores of different companies. In this case, the level of education of the Canadian population determined the pattern of comparison. For instance, the people with higher education, more than high school graduates can make comparisons between the Apple iPad and the ones from other firms as opposed to those with lower academic qualifications. Lastly, the post-purchase evaluation seems to be greater among the people who are more learned than those with little education. Therefore, all the consumer decision factors in this assignment were consistent with the model developed in the textbook.
1.2.3 The Type of decision to purchase an Apple iPad
The type of the purchase decisions of the Apple iPad consumers considered in this research is the variety-seeking purchasing behavior. By definition, this type refers to the buying behavior of the consumer in the conditions whose characteristic is the low involvement of the consumer and yet having imperative perceived brand differences (Kotler, 2009). This is the situation where a consumer switches from one brand to another to get the variety he or she prefers. For instance, the Canadian population that is moved by a variety of brands is the young and single people. Their motivation is derived from the lifestyle that of the youth who are not only sophisticated but also want the variety that will enable thrive in elegant kind of lifestyle. Fortunately, Apple iPad meets these sophisticated needs. It is worth to note that iPads producing companies have employed different marketing strategies for both minor brands and market leader. Apple Inc. has been a market leader which has attracted consumer habitual purchasing behavior. The firm has depicted this idea by being the dominant of the shelf spaces, operating the frequent reminder advertisements, and maintaining the shelves fully stocked. Additionally, for any company to challenge Apple iPad, they have to lower the price of their iPads, cut down the coupons, offer special deals, advertise more, and give free samples to the customers (Kotler and Armstrong, 2010). Unfortunately, the competitors cannot outperform Apple Inc. since it has a well-established reputation among the customers and thus consumers will choose the iPads from Apple.
1.2.4Five sales and marketing implications for Apple to increase their chance of success in selling to a consumer
Apple Inc. has reportedly made high sales as compared to firms in the consumer electronic space from its direct and channeling price marketing strategy to its storefronts and online. The first factor that has made Apple successful at the market is that it has maintained the stability of the reseller pricing. In this case, it is possible for Apple to manage to keep the retail stable in a remarkable way despite the condition that setting dealer pricing to its customers is illegal. Secondly, Apple has never discounted via its direct channel. The discounting of the firm occurs on the refurbished products, where there are changes in prices, but no sale pricing. Thirdly, retail and online storefronts or Apple are unique. They encourage education and supporting rather than selling. They are also simple, even austere, having minimal signage as well as crystal clear messaging. There is pervasive feeling that many companies concentrate on selling but cannot make the customer feel appreciated, which Apples through such support and education opportunities. The fourth aspect that places Apple Inc. at the top is its products which occur in unique categories. This company sales more products than other companies because it encourages the resellers to sell the products are in a unique form either online or on storefront shelves and thus attracting many customers.
The marketing implication of this point is that Apple has a long history of using marketing strategy of product placement uniquely as compared it competitors and thus keeping channel control and pricing aspects that are tight in maintaining such positioning. Thus, the five factors of sales are established from the above discussion. The fast factor is superior and unique brand perception or value proposition. Secondly, Apple gets a holy grail of sales due to its real or perceived monopoly in the electronics market. The third for Apple’s success is the vivid, channel strategy, top-down sales as well as the execution of the marketing approach in a disciplined manner. Fourth, the firm’s success stems from the perceived or real limited supply and high demand. Finally, the company enjoys the margins that are large enough to support a robust channel support infrastructure.
1.3 Mega Bloks— Segmentation and Positioning
1.3.1 Review of SWOT Analysis
The four factors of SWOT include collection and evaluation of the significant data; grouping the data into strengths, weaknesses, opportunities, and threats; SWOT matrix development; and incorporation of SWOT analysis into the process of decision-making.
Strength:
- Its network of distribution is in more than 100 nations around the world.
- The company has the license to utilize the characters such as Power Rangers and Barbie.
- There are top-ups for the production of products of the branded character.
- The ability to produce diverse products such as puzzles, coloring set, and building blocks among others.
- The organization’s focus on the products that are safe for the kids has contributed to its success.
Weakness:
- The firm’s involvement in lawsuits destroyed its public reputation.
- The focus of the company on marketing is low and also has limited global reach indicating low market share.
Opportunity:
- Its focus on new marketing programs for increasing the brand recall has been a potential opportunity.
- The possibility of the firm to associate with the leading e-tailers
- The introduction of unique products whose marketing can be internationally.
Threat:
- The company faces unfavorable political and government conditions which can also have an effect on exports.
- Stiff competition from its rivals such as Ideal Toy Company, BRIO, and LEGO.
- The firm is affected by the fluctuating economic conditions as well as the currency value instability.
1.3.2 Segment Approach
The marketing target segmentation considered for this research is a demographic segmentation. The company’s market segments are competitive and thus the firm has focused on innovation to improve the quality of the product and manage the costs. Additionally, this approach has made it possible for the company to manage the development of the product as well as the introduction processes for the readiness of the supply chain Mega Blok, 2017). In this case, the customers can get the existing information from the sources like previous searches, browser history and the information the users offer so as to establish consumers’ demographic profiles. Such information is useful to the marketers as it helps them to segment their targeted audience in a demographic way as well as the target advertisements at certain groups of individuals. This strategy aims at maximizing the probability of their advertisements to be viewed by their most profitable audience who make their target market.
1.3.1 Target Market Profiles
The target group for Mega Blok is the children aged between two and ten years who prefer building blocks and puzzles.
Demographic Segmentation
In this type of target market profile, online marketers can present the targeted advertisements on the basis of demography by use of through their own database or their stored data. This approach has involved age segmentation by considering a specific age group, particularly the children toys and puzzle games. Age is one of the demographic segmentation through which the marketers put the market into different age categories since the customers at the same age tend to have needs, wants, and interests that are similar (Lamb et al., 2011). Thus, the approach segmenting the target market based on the age groups makes it possible for the marketers to aim at a certain range of age which find their product or services attractive.
Behavioral Segmentation
This type of market segment groups the consumers into different categories based on their personal understanding of the product, the attitude they have towards it, and also the way they respond to the same product (Lamb et al., 2011). The advantage associated with this market segment is that it investigates the way the experience of the consumers influences the purchases in the offing. The marketing implication of this idea is that the marketers need to take into account their previous feedback as well as responses from the parents of the kids while planning for any new way of communication.
Psychographic Segmentation
In this category of the target segment, the marketer makes use of the psychological attributes of the consumers to group the market on the basis of the social class of the customers, lifestyle, and personality characteristics (Lamb et al., 2011). For instance, the statistical data concerning different age groups, such as the kids used in this research, determine the consumer behavior of a person. The findings indicated that kids are moved with items that have been produced with high level of creativity.
1.3.2 Recommendation
The primary target segment recommended for this study will be demographic segmentation since the decision of the customer to buy a product or service is determined by the age that is interested in appealing products (Lamb et al., 2011). Additionally, for the marketers to have a better understanding of the consumer’s value need, they should consider the cultural factors that affect the decisions the customers make on the Mega Brand.
Positioning Strategy
A positioning strategy used in determining the primary target market in this research is based on demographics. In this case, the marketers have focused on the kids by use of interactive games which are appealing to them. The reason for the demographics is that it provides the consumer information that helps to know which target market that can be effective for the company based on the age, gender, income, and ethnicity among others (Lamb et al., 2011). Another positioning parameter is the product quality. It is necessary for the company to note that most consumers are sensitive to the quality of the products or services than any other aspect.
1.3.3 Competence to be developed
The competence in the positioning of a product by a firm involves how it is able for it to differentiate what is offering and generate value for its market. In other words, it comprises carving out of a spot in the market landscape that is competitive, making its stake strong, and acquiring a greater competitive advantage in the market. The first competence is the customer segment of Mega Blok which comprises children who have wants of the same kind (Mega Blok, 2017). Secondly, the market profile is also another factor for the organization’s successful positioning which includes the growth stage, the size of the market, and competitors. Finally, the competitive analysis also forms a successful positioning strategy where the company conducts a SWOT (strength, weaknesses, opportunities, and threats) analysis.
1.3.4 A Positioning Map
A positioning map developed in this exercise is a perceptual map which looks like the diagram in Figure 2 below. This type of a map depicts the manner in which the marketplace groups or associates the advantages and as well provides an illustration of the brands across such benefits. The map shows that Mega Blok is not only highly innovative but also highly creative Mega Blok, 2017).
Figure 2: Perceptual Map of Mega Blok (Source: Dibb & Simkin, n.d, p.9)
1.4 Customer Relationship Management (CRM)
1.4.1 Definition of CRM and its Importance
The concept of CRM refers to the method that an organization uses to manage its interaction with the potential and current customers (Richards& Jones, 2008). CRM attempts to provide an analysis of the data concerning the history of the customer with a firm enhancing the business interactions with the customers, putting emphasis on the retention of the consumers and promoting the growth of the sales, in particular. The primary objective of CRM systems is to enhance the integration and automation of sales, customer support, and marketing. The three key components of the operational CRM include marketing automation, service automation, and sales force automation.
CRM is important as it helps in compiling the data from a variety of communication channels, which comprise live chat, email, telephone, social media, marketing materials, and the website of the company. Additionally, the method of CRM and the system for the facilitation of CRM make it possible for the companies to gain more knowledge concerning their target audience as well as the more appropriate way of meeting their needs. Nonetheless, the firm’s adoption of the CRM strategy may result in biases in the midst of consumers. Consequently, this situation will lead to dissatisfaction among the consumers and thus failing to meet the goals of CRM.
1.4.2 Steps used in the implementation of a CRM System.
The first step is marketing automation involves making the overall process of marketing easy so as to enhance its effectiveness and efficiency. In this approach, the tools of CRM having the capabilities of marketing automation can automate the activities that are repeated. For instance, such tasks may be posting information of marketing on the social media or sending automated marketing emails to the clients. This component aims at converting a lead of sales to a full customer. Additionally, the service automation comprises the technology of direct customer service. The examples in this category include the Dynamic CRM Software of Microsoft call resolution and call times tracking. Its purpose is to boost the customer service efficiency. Lastly, the automation of sales forces operates in conjunction with all phases of the cycle of sales, from the contact information of the initial entry to the conversion of a perspective of the customer into an actual customer.
Another step of implementing a CRM system is conducting employee training where the programs at teaching employees on the recognition and effective creation of the customer-brand interactions that are strong. Once of the employees or members within the specified departments is identified, the management organizes the training to address such needs.
2.0 Communicate the Value
2.1 Decisions
2.1.1 Definition of Integrated Marketing Communications
This term refers to expanding the traditional and modern marketing strategies, optimizing the communication of a message that is consistent and showing the brand of the firm to the stakeholders (Kitchen, & Burgmann, 2015). The success f hat IMC is based on the fact the marketers to identify the boundaries near the elements of the promotional mix as well as the effectiveness of message of the campaign which the audience can grasp.
2.1.2 Benefits of Integrated Marketing Communications
The first benefit of IMC is it enables the marketers to communicate the story of their brand in a vivid and efficient way and also to message over multiple communication channels for the creation of brand awareness. Additionally, the concept has proved to be more cost-effective as compared to mass media because the customers can relate with the brands across the different platforms and digital interfaces. Thirdly, IMC establishes a competitive advantage for a firm whose intentions are to improve profits and sales. The fourth benefit is that IMC helps the organizations to see their communication tactics performance rather than the fragmented pieces. Lastly, this aspect makes the customers become immersed in communication and thus helping them to go through several purchasing process phases.
2.1.3 Integrated Marketing Communications Initiatives for this Year
One of the initiatives of IMC this year focuses on the creation of the campaign which is not only effective but also consistent to market Apple iPad across the media forums. Additionally, the company’s marketing team seeks to advertise with a high level of product appeal through an execution that will attract many consumers. Also, the markers are planning to spend a lot of money on the distribution as well as the creation advertisements.
2.2 Advertising Critique
2.2.1 Comparison of a good and a bad advertisement
The advertisement of McDonald’s is a good advertised which was aired on March 27, 2017, on radio, TV, and social ads. The advertisement chosen is “J&J and Verizon Join Major Marketers Suspending YouTube Advertising.” This information was from a magazine which was published on March 22, 2017, by Jack Neff.
2.2.2 Critique of the two advertisements
The advertisement was simple and its title “Make it a Mickey D’s Morning” has run for the last few quarters and has been effective and efficient in conveying the brand’s message. This strategy has made it perform better in the market as compared to Dunkin Donuts and other beverage-related companies, showing the overall communication strategy being good. The selection of the picture was also excellent showing an advanced creativity of advertisers.In this advert, the marketers used communication mix where they created a clear visual presentation of the product to impress the audience. Additionally, the advert communicates positioning of the product online and conveys the key message of making the product to be used by the audience who would find the importance of using it for breakfast.
On the other hand, “J&J and Verizon Join Major Marketers Suspending YouTube Advertising” is considered bad because it is not attractive. The background chosen is not clear, and the colors are not eye catching indicating low creativity. There is also little information provided concerning the product, and thus it might be hard for the target audience to lack what they need to know about the product to make decisions. This idea indicates the poor overall communication strategy. In this advertisement, there are limited communication tactics since the advertiser does provide not only a little information about the product but also creates a less visual impression.
The audience for the McDonald’s advert were the young populations especially those who are schooling and are sensitive to the taste and color of the product (McDonald’s, 2017). The perceived value of this product is depicted in the choice of the color which shows the quality of the product that this company is offering to the consumers. Therefore, the customers tend to be attracted by the appearance of this product. On the other hand, the message conveyed may create a perceived value since the customer cannot tell how it tastes or meets their need by simply reading the message that runs on the television screen. Though, it makes the person have an urge of having consumer experience by purchasing it. Because of the clear visual impression that the advertiser provides, the advertisement is thus considered as a good advert.
However, the target audience for the J&J Company advert aims at kids as the main consumer (Neff, 2017). The consumer behavior of such group is determined by the impacts such product has on the user other than the taste and preferences. The consumers of such product obtain the value by looking at the information regarding its importance to the user and the ingredients that have been used to make it different from others. This advertisement is bad because it does not show a clear visual impression and has limited message concerning the product.
2.3 Communication Brief
2.3.1 Communication Brief of Lotusland
The company advertisement displays the information that the consumer needs to know about the product, whose target is the people who are above 18 years of age. Advertisers were creative and communicated that objective of the product positioning in a vivid manner.
2.3.2 Elements of Communication
Communication Objective: The objective is stated comprising inviting the audience to an event where the company creates products awareness of wine.
Targeted audience: No specific age has been provided meaning all people who take wine are invited.
Creativity: The advertiser uses a variety of impressive colors.
Communication mix: The advertiser uses a variety of colors, objects, and messages to portray the value of the product. Thus the customers who are conscious about these aspects will ensure that they attend the function and purchase the item.
Communication strategy:Product positioning has utilized an actual picture of the product.
Communication of positioning and key message: The product runs on the screen of the television repeatedly for emphasis with the message concerning the event as well as the value of the item.
Communication tactics:The language used is easy to read and understand. The advertisement does use any jargon. Also, pictorial presentation of the message has been used where the image of the bottle of wine is shown.
Evaluation: The perceived audience comprises those people who drink wine within Canada. Nevertheless, there has to be a specific group that should attend such a function since children cannot be allowed. Thus, the actual value created for the audiences is that the product is of high quality as compared to others. Also, the advertisement campaign creates further awareness about the value of using the product and benefits such as low prices and availability in different quantities among other factors that the consumers may enjoy as they use the product. This advert is a good one because it does not only provide the information the target audience but also has an impressive visual presentation.
The budget for the IMC plan is as shown in Table 8 in the Appendix.
References
Bidtnes, C. (2017). Kingston CMA demographics. Retrieved from
http://business.kingstoncanada.com/en/statistics/demographics.asp
Dibb, S. & Simkin, L. (n.d). Targeting, segments, and positioning. International Journal of Retail and Distribution Management, 19(3), 4-10.
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Neff, J. (2017). J&J and Verizon join major marketers suspending YouTube advertising. Retrieved from http://adage.com/article/digital/j-j-verizon-suspends-youtube-advertising-globally-brand-safety/308401/
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