Class 1 article 1 : Key points : Don't Worry About Market Share.

Focus on Profit Share Instead

Strategies for Success:

1. Focus on your Ideal Customer: (identify, understand, target messaging to the right audience)
2. Create a High-Value Product/Service: (Tailor products or services to meet the emotional and practical needs,
streamline processes for maximum value)
3. Market differentiation: stand-out from the crowd, identify areas where you are better than the compt. Carve out a
distinct position in the market to command better-than-average profit margins
4. Strive on Operational Excellence: develop playbooks, ensure operational efficiency and quality to execute the
chosen strategy effectively.
5. Optimizing pricing: Don’t’ leave money on the table, Set prices based on the value you provide, charging more than
standard rates for a higher profit margin.

Vanity Metrics vs. Solid Strategy:

1. Market share and total revenues may be impressive but are considered vanity metrics.
2. Long-term success comes from a solid strategy that focuses on the most profitable customers rather than broad
market dominance.

TOPIC: Marketing in a Digital World (5 readings)

Article 1: Readings for class 7: The Who, Why and What of Digital Marketing, Alexander, 2022
Digital Marketing

 All marketing efforts that occur online

 Digital channels: Search engines, social media.
 It’s a way to communicate with a target audience.

Why is it important?
 Larger audience reach.
 More cost-effective than traditional
 Measurable right away
 Builds brand awareness.
 Allows for creativity and experimentation with various tactics (on a budget)

Benefits

 Measurable and trackable (view important metrics that matter to a company (shares, views, clicks, time
on page, impressions, CTA).
 Allows for smaller brand to compete with bigger ones
 Easier to adapt and change a digital mark. Strategy
 Focused efforts on prospect most likely to purchase (personalized, high-converting messages)
 Engage audience at every stage of the customer journey (awareness, consideration, purchase, retention,
advocacy),

Types of digital marketing

 SEO: Elevate website rankings with optimized content.

 Content Marketing: Engage audiences with valuable content across mediums. (blogs, audio, visuals)
 Social Media Marketing: Promote through social platforms for brand visibility.
 PPC: Boost visibility via paid ads on search or social platforms.
 Affiliate Marketing: Earn by promoting others' products on your site.
 Native Advertising: Blend paid content seamlessly with platform content.
1
  Marketing Automation: Streamline tasks with software for efficient campaigns (emails, newsletter, social
media post scheduling).
 Email Marketing: Targeted emails drive engagement and nurture leads.
 Online PR: Manage digital reputation through reviews and engagement.
 Inbound Marketing: Attract, engage, and delight customers with valuable experiences. *blogging, pop-
ads, video marketing…)
 Sponsored Content: Pay for features on third-party platforms for exposure.
 SEM: Gain instant visibility through paid ads on search engines.
 Instant Messaging Marketing: Connect with customers instantly for promotions and updates. (flash sales,
new product or updates on your order).

What Does a Digital Marketer Do?

 Plan, implement, and manage digital campaigns while analyzing metrics for data-driven decisions, using
tools to engage the target audience and drive conversions.

Inbound Marketing vs. Digital Marketing: Which is it?

 Inbound marketing, a subset, focuses on attracting, engaging, and delighting through valuable content;
 digital marketing encompasses all online efforts (including inbound Mark.)

B2B Digital Marketing

 Build buyer personas to identify audience needs and create valuable online content.

B2C Digital Marketing

 Utilize business-focused channels like LinkedIn and create accelerated buyer journeys with stronger CTAs
on platforms like Instagram and Pinterest.

How to Do Digital Marketing

1. Define goals clearly.: ex: increasing brand awareness, driving website traffic, generate leads.
2. Identify target audience needs. (preferences and behaviors too, for targeted and personalized content that
resonate!
3. Establish a budget based on effectiveness: Allocate resources based on digital channel effectiveness and ROI
potential.
4. Create engaging, high-quality content: that provide value to T.A & encourages engagement and interactions.
5. Optimize for mobile usage.; cohesiveness via all platforms
6. Conduct keyword research for SEO : to improve rankings an visibility (keywords and phrases that align with the
T.A)
7. Measure and analyze campaign results for continuous improvement: Track and analyze digital campaign
performance with analytics tools for data-driven decisions and improvements.

Article 2: Reading for class 7: The Top 10 Social Media Sites and Platforms 2022, Walsh, 2022
1. Facebook: Largest platform with 2.9B users, offering profiles, pages, groups, and advertising options.
2. YouTube: Video-sharing platform with 2.2B users for uploading, viewing, and sharing videos.
3. WhatsApp: Messaging app with 2B users for text, voice, and video, boasting a 98% SMS open rate.
4. Instagram: Visual-focused platform with 2B users, known for photo/video sharing and features like stories and
reels.
5. TikTok: Short-form video platform with 3B downloads globally, popular among younger demographics.
6. Snapchat: Multimedia messaging app with 538M users, known for disappearing content and youth appeal.

2
7. Pinterest: Visual discovery platform with 444M users, focused on saving and discovering ideas through images.
Organizing and sharing contents
8. Reddit: Social news aggregation platform with 430M users, featuring diverse communities (subreddits).
9. LinkedIn: Professional networking platform with 830M members, used for connections, job searching, and
industry networking.
10. Twitter: Microblogging platform with 217M users for real-time updates and discussions through short
messages (tweets).

Which Social media platforms to use?

1. Identify Target Audience: Understand where your audience is most active online.
2. Consider Platform Features: Evaluate features aligning with marketing objectives.
3. Analyze User Demographics: Ensure platform demographics match your target audience. age, gender, location,
and interests
4. Assess Engagement and Reach: Evaluate platform engagement and broad audience reach.
5. Consider Content Type: Choose platforms suited for your planned content type.
6. Evaluate Advertising Options: Assess ad options, targeting, formats, and cost-effectiveness.
7. Research Competition: Analyze competitor strategies on active platforms.
8. Set Clear Goals: Define goals and choose platforms aligning with objectives.

Article 3: Readings for class 7 : 5 Important Digital Marketing KPIs To Track

1. Click-Through Rate (CTR):

 % of link clicks from impressions, measuring audience action.

 Aiming for 1%+ CTR, analyze historical data for strategy improvement.
 It helps to understand what resonates and evokes action among the audience

2. Conversion Rate: The action, the completion!

 Measures % of users completing desired actions.
 Insights into funnel success and marketing efforts.
 Focus on seamless experiences to enhance conversion rates.
 # of conversion divided by total number of visitors

3. Digital Engagement:
 Measure social media content impact and reach.
 What drives the most visitors.
 Aim for 75% of your content to produce 1%-5% engagement rate; create valuable content for impact.

4. Keyword Ranking:

 Track website ranking, optimize keywords for visibility.

 Replicate content around core keywords for organic ranking.
 Staying relevant, improve visibility

5. Customer Acquisition Cost (CAC):

 Cost of acquiring a customer; analyze campaign effectiveness.

 Use CAC for efficient budgeting and resource allocation.
 Analyzes campaign effectiveness in revenue-generating customer acquisition.

Article 4: Reading for class 7: The Role of Artificial Intelligence in Marketing

How is AI used in marketing:

3
Social Media Listening:
 AI boosts social media listening efficiency, providing real-time insights.
 Sprout's AI Queries enhance tracking and discover audience insights faster.
 Sentiment analysis anticipates customer moves, enabling strategic actions.

Content Generation:
 AI-driven tools analyze VoC (voice of customer) data for impactful posts and product descriptions.
 identify keywords and triggers to develop compelling posts, respond effectively to customer comments,
and create impactful product descriptions.
 AI-generated ideas enhance nurture campaigns, fostering loyalty and sales.

Automation:
 AI-driven automation streamlines social media and customer service tasks.
 Lexical triggers ensure intelligent workflows, optimizing post schedules and message categorization.
 Suggested Replies reduce response time, ensuring a unified brand voice.

Audience Segmentation and Personalization:

 AI enables omnichannel strategies and personalized marketing tactics for brand loyalty.
 Programmatic advertising optimizes digital ads for maximum ROI.

Data Analysis and Customer Insights:

 AI and machine learning provide critical insights for strategic marketing decisions.
 Deep insights into sentiment, customer care performance, and social engagement metrics.
 Adapt quickly to changing market trends and prioritize budgets based on data-driven insights.

Reputation Management:

 AI tools monitor online platforms, perform sentiment analysis, and address customer concerns.
 Strategic influencer selection enhances proactive customer care.

Competitive Intelligence:

 AI-powered tools analyze competitor strategies, pricing, and feedback.

 Stay ahead in the market by understanding trends and identifying opportunities.

Multilingual Advantage:

 AI translation tools enable global content delivery, improving engagement and expanding market reach.

The future of AI

Computer vision: empowers AI marketing with insights from non-text data like images, enhancing analysis and
customer experience.

AI chatbots: revolutionize marketing by boosting brand visibility, engaging customers, and providing valuable
insights for personalized strategies. It can improve customer support, increase engagement.

Predictive and Prescriptive AI: facilitates data-driven decision-making, categorizing social listening data for
targeted content and ads. Helps in L-T business planning and enables data-driven decision-making and strategic
marketing.

4
Responsible AI: prioritizes fairness, security, inclusivity, and transparency, ensuring ethical practices, data privacy,
and unbiased strategies.

AI technologies:

1. Machine Learning (ML):

 Analyzes social data with statistical precision, automating tasks like text mining and semantic
clustering.

2. Natural Language Processing (NLP):

 Powers AI tools to semantically understand social listening data, extracting critical information
from posts using lexical and statistical methods.

3. Semantic Search:

 Understands intent without keywords, categorizes relevant keywords into semantic clusters, and
eliminates duplicates in text mining.

4. Named Entity Recognition (NER) and Neural Networks:

o Identifies entities in big data, establishes context through relationships, and utilizes neural
networks for precise results over time.
o mimic how the human brain handles information and remember interconnected data points
5. Sentiment Analysis:

 Measures customer sentiment from feedback data, analyzing social listening data in real-time, and
assigning polarity scores for evaluating sentiment and improving customer experience. (surveys,
reviews) .

Article 5: Reading for class 7: metaverse

1. Significant Attention: Metaverse searches surged 7,200% in 2021, reflecting growing interest.

2. Meta's Ambition: Facebook rebranded as Meta, aiming to bring the metaverse to life.

3. Capital Inflow: Over $10 billion raised in 2021 for metaverse-related companies.

4. Conceptual Fluidity: Metaverse lacks a universally agreed-upon definition.

5. Key Elements:
o Immersive environments, real-time existence, virtual/physical world integration, virtual economy,
and user virtual identities.
 Marketers see metaverse as innovative consumer engagement.
6. Fundamental Shift:

 Skepticism exists, but metaverse signifies a fundamental internet usage shift. Metaverse is an internet
evolution, immersing users in digital worlds.
7. Always-On Real Time:

 Metaverse operates continuously in real time, fostering innovation and consumer adoption.

8. Strategic Implications:

 Metaverse extends beyond marketing, prompting strategic considerations for various business
functions.

9. Talent Acquisition:

5
  Marketers need to secure talent in areas like augmented reality, virtual reality, consumer journey
analytics, and social commerce.

10. Future Planning:

 Early metaverse planning yields substantial future benefits for organizations and brands.

Class 8 TOPIC: BRANDING (6 READINGS)

Reading 1: for Class 8: If Brands Are Built over Years, Why Are They Managed over Quarters _
 Clear business objectives and measurement are crucial for brand success.
 Overemphasis on promotions weakens brands, impacting long-term health.
 Short-term orientation erodes a brand's competitive ability in the marketplace.
 Focusing on quarterly metrics hinders a brand's fuller story understanding.
 Brand managers should refocus on the principles that made their brands successful.
 Long-term brand-health measures are essential for understanding brand value.
 Brand management should prioritize long-term impact and profitability.
 Stockpiling occurs when customers perceive a good deal, impacting profitability.
 Long-term metrics provide a better perspective on brand profitability.

Diluted Brand Equity:

 Promotions focus on price, diminishing brand distinctiveness (quality vs price)
 Products risk becoming commodities, increasing price sensitivity.

Competitive Response:
 Competitors often match increased discounts.
 Intensified price competition hinders brand differentiation.
 Promotions become less effective in driving sales growth.

How Long-Term Metrics Improve Brand Performance

Preventing Short-Term Focus:
 Dashboard approach diversifies focus beyond short-term data.
 Comprehensive metrics assess long-term effects of price promotions on brand equity.
Performance Evaluation for Brand Managers:
 Brand managers evaluated on quarterly and long-term metrics.
 Discourages discounting strong brands, emphasizing long-term health considerations.
Informing Marketing Decisions:
 Long-term metrics is crucial in informing marketing decisions.
 Karft’s launch of DiGiorno's impact on mid-tier pizza brands showcases the importance of considering
long-term effects.
Case Example - DiGiorno Launch:
 DiGiorno launch affected mid-tier brands, causing a drop in price premiums.
 Long-term metrics offer insights, preventing potential misinterpretations in marketing strategies.

Reading 2: for Class 8: Branding in the Digital Age_ You’re Spending Your Money in All the Wrong Places
o Consumers connect with brands in new ways through media beyond manufacturers' and retailers' control.
o Traditional marketing strategies need redesigning to align with changed brand relationships.
o Marketing strategies should align with the CDJ, focusing on influencing consumers at the right touch points.

6
Evolved Consumer Connections:
 Consumers connect with brands through diverse, uncontrollable media channels.
 Traditional marketing strategies need redesigning to align with changing brand relationships.

Strategic Consumer Decision Journey (CDJ):

 CDJ comprises four stages: consider, evaluate, buy, and enjoy, advocate, bond.
 Marketers should target specific CDJ stages and prioritize influence during evaluate and enjoy-
advocate-bond.
Integrated Customer Experience:
 Coordination between owned-media channels and consistent messaging is crucial.
 Companies should adapt roles, including orchestrator, publisher, content supply chain manager,
and marketplace intelligence leader.
New Roles for Marketing:
• Orchestrator: Coordination of owned-media channels.
• Publisher and "content supply chain" manager: Efficient management of content creation and flow.
• Marketplace intelligence leader: Marketing takes a lead role in collecting and using customer data.
Consumer Decision Journey (CDJ):

CDJ stages: consider, evaluate, buy, enjoy-advocate-bond.

• Consider: Assembling initial product consideration set.
• Evaluate: Seeking input to shape choices from peers, reviewers, retailers.
• Buy: Making the purchase decision, often in-store.
• Enjoy-Advocate-Bond: Forming a deeper connection, leading to advocacy and repeat purchases.

Rethinking Traditional Marketing Funnel:

• Traditional funnel outdated; doesn't align with CDJ.
• Focus on specific decision journey stages.

Digital Age Impact on Consumer Behavior:

• Online research, comparisons, and reviews crucial in decision-making.
• Retail sites, especially Amazon, influential during the evaluate stage.
• Post-purchase interactions play a significant role in advocacy.

Adapting Marketing Strategies to Digital Age:

• Allocate resources to owned and earned media.
• Consider nonworking spend, including content creation and management.

Case Study - Shifting Marketing Strategy:

• Reallocation away from paid media based on CDJ analysis.
• Emphasis on seamless integration with retail sites, particularly Amazon.
• Aggressive distribution of positive third-party reviews for advocacy.
• Post-purchase relationships built through online community initiatives.
• Implementation of a new content development system for consistent messaging.

Reading 3: for class 8: 10 Examples of Online Communities from Brands You Love

1. Branded Communities Overview:

 Digital spaces owned by organizations for brand enthusiasts.
 Connect with customers, employees, investors, or stakeholders.

7
 2. Benefits of Branded Communities:
 Direct customer access, brand conversation shaping, user-generated content.
 Market research, brand awareness, loyalty boost, rich insights.
 Co-creation, decreased support costs, increased engagement.
3. Impact on Brands:
 Build deeper customer relationships and loyalty.
 Improve products, reduce customer support needs.
 Foster belonging, knowledge sharing, support, and engagement.
________________________________________________

1. LEGO Ideas (LEGO):

 Facilitates co-creation and collaboration (product ideas, voting systems) among over 1.8 million
members.
2. Beauty Insider Community (Sephora):
 Dedicated space offering user-generated content and real-time feedback. Q&A. Community
engagement (ambassador program).
3. Harley Owners Group (Harley Davidson):
 Connects over 1 million Harley owners, fostering loyalty and advocacy. (exclusive events,
magazine and merch)
4. Creator’s Studio (Rust-Oleum):
 Community for creators, solving challenges and providing user-generated content fostering
connections.
5. Duolingo:
 Focused on free language education, engaging 300 million users worldwide. Allows members to
contribute to ideas and create courses.
6. Salesforce Trailblazer (Salesforce):
 Empowers Salesforce users, fostering collaboration and reducing the need for customer support.
7. Peloton Facebook Group:
 Connects over 400,000 members for motivation and fitness support. (challenges, recos…)
8. Tech Ladies:
 Online community of 100,000+ women in tech, providing a safe space.
9. Instant Pot Facebook Group:
 Social learning group with 3 million members, sharing cooking insights.
10. A Bra That Fits Subreddit:
 Educates on bra sizing, with 277,000+ members across platforms.
Banded communities, It’s important because:
 Deeper Connections and Engagement: cultivate meaningful connections, fostering collaboration,
innovation, and brand loyalty.
 Direct Access and User-Generated Content: provide a platform for direct engagement with customers,
shaping brand conversations and sourcing valuable user-generated content.
 Insights and Informed Marketing: offer rich insights, reduce support costs, and contribute to more
informed marketing strategies, playing a crucial role in sustained brand growth.

Reading 4: class 8: Learn all about Lifestyle Marketing

 Lifestyle brands build a devoted and cult-like following, fostering a sense of community around the brand
and its products.
8
  It involves creating a brand image that alighs with the consumer’s lifestyle ideals.
 inspire their audience toward a better life, aiming to create trust and respect.
 Prioritizing their audience, lifestyle brands tailor content and marketing to resonate with specific interests,
values, and aspirations, focusing on a niche audience.
 Lifestyle marketing brands products with aesthetics and ideals, creating an aspirational connection that
makes consumers crave association with the brand.

Examples of Lifestyle Branding:

o Nike, Puma, Adidas: The athlete lifestyle.
o Vans, The North Face, DC Shoes: The thrill-seeker lifestyle.
o Jeep, Harley Davidson: The adventurer lifestyle.
o Warby Parker, Dior: The trend-spotter lifestyle.
Characteristics of Lifestyle Brands:
o Lifestyle brands have a devoted following, an emotional connection, inspire a better life, focus on the
audience, and cater to a niche audience.
How to create a LB
o Define the lifestyle to sell, weave it into the brand, be personal, use content to create experice and build a
strong community around your brand.
Tips:
o Thorough research (target audience, goals aspiration, look at competitors)
o Build a unique brand personality: adapt and resonate with folowers, branded buzzwords…
o cohesive demonstration of ideals, commit and convey them
o Content creative experience: to engage your audience (stortytelling, visuals, interactive elements).
o Build your community: actively engage with T.A Encourage interaction… create ops to connect with each
other.
Reading 5: for class 8 : Coca-Cola

1. Brand Identity Control: Coca-Cola invests in its own studio for greater control over music in ads, fostering
a distinct brand identity.
2. Emotional Connections: Collaboration with artists aims to create emotional connections, enhancing the
advertising experience.
3. Value Beyond Transactions: Coca-Cola seeks to transcend transactional relationships, contributing to
music culture and investing in real artists.
4. Experiential Marketing: Shifting from traditional ads to experiences, leveraging music as a medium for
scalable, diverse market engagement.
5. Innovation Commitment: The studio investment showcases Coca-Cola's commitment to innovation and
creativity in marketing, pushing boundaries and exploring new audience engagement methods.

Reading 6: for class 8 : Core Reading_ Brands and Brand Equity_HBR (49 pages!)

Lexicon:
Brand Community:
- Geographically agnostic group formed around shared brand connection.
Brand Culture:
- Shared stories and ideas associated with a brand, evolving over time.
- The meaning that other attributes to the brand elements.
Brand Equity:
- Set of assets linked to a brand’s name impacting product or service value.
- Assets Include: Brand awareness, perceived quality, brand associations, brand loyalty, intellectual
property (competitive advantage).
Brand Extensions:

9
 - Use of an existing brand name on a new product in a related or different category.
Branding Elements:
- Collection of markers identifying a brand.
- Elements Include: Brand name, logo, tagline, symbol, character.
Brand Personality:
- Set of human traits ascribed to a brand, influencing consumer preferences.
Brand Value:
- Definition: Quantitative measurement of the financial value of a brand.
- Evaluation: Third-party valuation models judge marketing success and validate budgets.
Country of Origin Effect:
- Influence of a product's manufacture location on consumer perception.
- Impact: Preexisting opinions about a country or location lead to positive or negative biases.
Customer Centricity:
- Definition: Set of beliefs prioritizing customer interests for long-term, profitable enterprise.
Economy of Scale:
- Cost advantage with increased volume output, leading to lower per-unit fixed cost.
Marketing Mix (4 Ps):
- Components of an effective marketing strategy. *Product, price, placement, promotion)
Product Mix/Portfolio:
- :Entirety of a company’s product offerings.

David Aaker's Categories of Brand Equity Components

Brand Awareness:
 Key Point: Familiarity is foundational, instilling consumer confidence and influencing purchase
decisions, especially in unfamiliar environments.
Perceived Quality:
 Key Point: Brand perception as a marker of quality, whether real or perceived, justifies pricing,
attracts interest, and facilitates potential line extensions.
Brand Associations:
 Key Point: Subjective and emotional associations contribute significantly to brand equity, shaping
a brand's personality and influencing positive or negative attitudes.
Brand Loyalty:
 Key Point: The strongest measure of brand equity involves repeat purchases and word of mouth,
offering benefits like reduced marketing costs and quick responses to competitive threats.
Other Brand Assets:
 Key Point: Beyond consumer perceptions, patents and trademarks also contribute to brand equity
by creating barriers to entry and maintaining a competitive advantage.

Geographical Quality Associations:

o Consumers associate specific regions with high-quality brands and products.
Consumer Perception Impact:
o Brands from certain countries are perceived as more authentic and higher quality, affecting
competition.
Illustrative Example - Chocolates El Rey:
o Chocolates El Rey in Venezuela faces the provenance paradox despite high quality, struggling
globally due to consumer biases.
Country of Origin Effect:
o The provenance paradox creates challenges for companies in competitively pricing products and
achieving global growth.
Global Challenges and Revenue:

10
 o Companies like El Rey, Concha y Toro, and Infosys find it difficult to overcome consumer biases,
impacting pricing and revenue for global expansion.

An example with Coca-Cola;

Motivation for Reformulation:
 Key Point: Coca-Cola aimed to surpass Pepsi in taste based on the results of the Pepsi Challenge. The
company created a new reformulation of it’s classic beverage.
Unforeseen Consumer Backlash:
 Key Point: The introduction of New Coke triggered protests, daily complaint calls, letter-writing campaigns,
and threats of a class action lawsuit.
Swift Reversal and Positive Outcome:
 Key Point: Faced with significant backlash, Coca-Cola reintroduced the original formula, leading to a surge
in stock price and emphasizing the importance of recognizing consumer emotional attachment.
Lessons Learned:
 Key Point: The New Coke fiasco serves as a lesson in understanding consumer emotional attachment,
highlighting the intangible, emotional aspects of a brand often missed by traditional market research.

Brand resonance pyramid

Hierarchy of Brand Loyalty:

 The Brand Resonance Pyramid outlines the stages of brand loyalty, starting from brand awareness and
progressing to a deep emotional connection, loyalty, and advocacy.
Measuring Brand Strength:
 It provides a structured framework for marketers to measure and strengthen their brand's position in the
market by focusing on different levels of consumer engagement.
Creating Emotional Connections:
 The pyramid emphasizes the importance of creating emotional connections with consumers, as strong
emotional bonds lead to higher levels of brand resonance.
Driving Brand Advocacy:
 The ultimate goal is to reach the top of the pyramid, where customers become brand advocates, actively
promoting the brand and influencing others, contributing to sustained success.

Brands should be: BRAND ELEMENTS

Memorable:
11
 - easily recognizable and memorable, aiding in purchase and consumption. (short names, tide, dove silk…)
Meaningful:
- should convey relevant, credible information about the product, such as category, ingredient, purpose, or
target customer. DieHard batteries, Caress soap…
Likable:
- Should evoke positive feelings, with aesthetically pleasing elements that resonate with consumers.
Snuggle bear, Jolly green giant, tiger
Transferable:
- should be adaptable to introducing new products in various categories and capable of building brand
equity across different markets. Challenges in creating truly global brands.
Adaptable:
- Consideration for adaptability and updatable nature, ensuring that brand elements don't become dated
quickly and are assessed for regional meanings.
Protectable:
- Brand elements need legal defensibility, questioning trademark ability and being aware of potential loss of
protection for widely known brand names.

CUSTOMER EXPERIECE Class 9 ( 4 readings)

READING 1: Class 9 Experience-Led Growth: A New Way to Create Value

Strategy Focus:
 Improving existing customer experience is the primary strategy for achieving breakthrough
growth.
Impact:
 Incumbent companies adopting this strategy can achieve more than double the growth compared
to industry peers.
Common Challenge:
 Large companies face challenges of commoditization and disruption from digital-native firms.
Key Numbers:
 Acquiring one lost customer may require acquiring three new customers, and 80% of value
creation comes from successful growth companies' existing customer bases.
Experience-led Growth Strategy:
 Involves creating a distinctive, consistent, and proactive customer experience measured through
financial metrics like share of wallet and repeat purchases.
Mobile Telecom Operator Case Study:
 Transformation through improved customer experience led to a 75% reduction in churn rates and
nearly doubled revenues in three years.
Financial Benefits of Experience-led Growth:
 Strategies delivering 20% increased customer satisfaction can result in increased cross-sell rates,
share of wallet, and improved overall satisfaction and engagement.
Three Pillars of Experience-led Growth:

Clear Aspiration: Aligning the brand vision with financial goals, prioritizing customer experiences.
Business Transformation: Redesigning P&S for expanded revenue through enhanced customer experiences.
Enabling Change: Dev. New capabilities, technologies, and governance for continuous improvement with effective
CX measurement.

1. Success Indicators:
 Key Point: Personal knowledge, compelling growth story, predictive analytics.
2. CX Leaders vs. Acquisition:
 Key Point: CX leaders prioritize customer delight for greater value.
3. Conclusion - Experience-led Growth:
12
  Key Point: Sustainable growth through exceptional customer experience.

READING 2: Class 9 Competing on Customer Journeys

1. Key Capabilities for Competitive Advantage:
 Focus Areas: Automation, personalization, contextual interaction, journey innovation.
2. Organizational Structure for Success:
 Critical Roles: Chief Experience Officer, journey-focused strategist, journey product manager.
3. Shift in Strategy Emphasis:
 Change from Reactive to Proactive: Designing value-driven customer journeys that attract and retain
customers.
Cutting-edge journeys succeed by creating new value for customers, making them beneficial experiences that customers want
to engage with.

Key capabilities:
1. Automation: Streamlining the customer journey through digitization, transforming complex operations into simple,
engaging experiences.
2. Proactive Personalization: Instantly customizing experiences based on past interactions, optimizing the next steps in
the customer's journey.
3. Contextual Interaction: Utilizing knowledge of the customer's location to guide them forward, adapting screen
appearance, and delivering relevant messages.
4. Journey Innovation: Continuous experimentation to identify opportunities for extending the customer relationship,
including testing versions, prototyping services, and adding useful steps or features.

Sungevity example:
 Competitive Customer Journey: Sungevity excels in shaping the customer journey, managing end-to-end processes
from sales to custom installation of residential solar panels.
 Digital Innovation: Sungevity's "product" is a seamless, personalized digital journey, employing innovative data
management from a Google Earth introduction to customized energy calculations.
 Holistic Approach: The company coordinates an ecosystem of partners for supply, finance, installation, and service,
demonstrating a comprehensive and integrated approach to customer service.
Creating a superior customer journey is for winning brands.

READING 3: Class 9 Unleashing the Co-Creation of Value" by Jagdish N. Sheth and Karl Hellman:
1. Co-Creation of Value:

o Consumers and marketers co-create brand identity and value online.

o Examples: customer experience, decision-making, digital marketing, and innovation.
2. Collaboration with Suppliers:

o Supply chain management optimizes functions, fostering innovation.

o Collaboration with suppliers enhances efficiency.
3. Collaboration with Competitors:

o Industry structures turn competitors into partners.

o Collaborating competitors lead to win-win situations and R&D advancements.
4. Collaboration with New Entrants:

o Giants provide resources; new entrants bring technology and skills.

o Collaboration benefits both industry giants and newcomers.
5. Co-Creation Opportunities:

o Marketers seek co-creation using Porter's five forces model.

o Shift from competition to collaboration for value co-creation.

READING 4: Class 9 T he Most Important Metrics You’re Not Tracking (Yet)

13
Customer-Centric Shift:

 Organizations adopt Customer Performance Indicators (CPIs) for a customer-centric shift.

Outcome-Focused Metrics:

 CPIs prioritize metrics important to customers, shifting from company-centric metrics.

Business Performance Impact:

 A CPI-driven, customer-centric culture correlates with improved business performance and growth.

Reciprocal Measurement:

 True customer-centricity involves measuring how the company performs for customers.

Measuring Customer Interactions:

 CPIs enable measuring desired outcomes in every customer interaction.

Predictive Power of CPIs:

 CPIs serve as powerful predictors of organizational growth.

Industry Insight:

 Example in insurance: "Fast Quote" CPI correlates with growth.

CPI Criteria:

 CPIs must reflect customer-important outcomes and be measured in valued increments.

NPS Distinction: *Net promoter score

 NPS is a KPI, not a CPI; customers don't directly care about it.

Cross-Departmental Utility:

 Departments leverage CPIs, including marketing, sales, product management, customer service,
operations, and finance.

Departmental CPI Examples:

 Marketing: Payment Flexibility for acquisition and retention.

 Sales: Quote Turnaround Time for successful sales.
 Product Management: Song Liked by Friends for customer engagement.
 Customer Service: First Time Resolution for customer retention.
 Operations: Nothing Broke (U.S. grocery delivery) for customer satisfaction.

PRICING ( 4 readings for class 10)

READING 1: Class 10 The elements of value The 30 Elements of Consumer Value_ A Hierarchy

Introduction:
• Identifying what consumers truly value is complex but crucial for businesses.
Challenges in Managing Value:
 Consumers evaluate products based on perceived value vs. asking price.
 Managing value involves functional and emotional aspects.
14
  Traditional research methods may limit understanding of new value concepts.
Elements of Value:

 30 fundamental attributes categorized as functional, emotional, life-changing, and social impact.

 Examples: motivation (Fitbit), organization (The Container Store), self-actualization (Leica).
Model Roots in Maslow’s Hierarchy:

 Model inspired by Maslow's hierarchy of needs, extending insights to consumer behavior.

 Emphasizes delivering higher-order value requires fulfilling basic functional elements.

Testing Elements’ Impact on Company Performance:

 Collaborated with Research Now to survey 10,000 U.S. consumers on perceptions of 50 companies.
 Companies excelling in multiple elements had three times higher Net Promoter Scores (NPS) and four
times greater revenue growth.
Digital Retailers and Value:

 Digital retailers leverage functional elements for growth.

 Amazon's success linked to adding value elements, enhancing loyalty.
Patterns of Value Creation:

 Perceived quality universally affects customer advocacy.

 Importance of elements varies by industry (e.g., sensory appeal in food, connectivity in smartphones).
 Well-designed digital businesses excel in time-saving and hassle avoidance.

Combining Digital and Physical Channels:

 Omnichannel retailers excel in emotional and life-changing elements.

 Fusion of digital and physical channels is powerful for business success.
Putting Elements to Work:

 Companies use the model to refine product designs and identify strengths/weaknesses.
 Vanguard added automated advice to investment services based on identified elements.
 Financial services company used elements to develop and test new checking account concepts.
Getting Started with Elements of Value:

 Recognizing value as a growth opportunity is crucial.

 Elements of value can inform new product development, pricing strategies, and customer segmentation.
 Assigning responsibility for thinking about, managing, and monitoring value is essential.
Conclusion:

 Understanding and creatively delivering value using the elements can give companies a competitive edge.
 The elements provide a structured approach to addressing consumer needs and preferences.

1. Life-Changing Elements:
 Motivation: Inspires and motivates.
 Self-Actualization: Fulfills self-improvement.
2. Social Impact Elements:
 Badge Value: Enhances identity.
 Attractiveness: Adds appeal.
 Affiliation and Belonging: Fosters community.
3. Emotional Elements:
 Reduces Anxiety: Eases worries.

15
  Provides Entertainment: Offers enjoyment.
4. Functional Elements:
 Saves Time: Reduces task time.
 Avoids Hassles: Minimizes inconvenience.
 Simplifies: Makes tasks less complex.
 Reduces Effort: Lowers energy needed.

1. Life-Changing Elements:
 Motivation: Inspires and motivates.
 Self-Actualization: Fulfills self-improvement.
2. Social Impact Elements:
 Badge Value: Enhances identity.
 Attractiveness: Adds appeal.
 Affiliation and Belonging: Fosters community.
3. Emotional Elements:
 Reduces Anxiety: Eases worries.
 Provides Entertainment: Offers enjoyment.
4. Functional Elements:

16
 Saves Time: Reduces task time.

Avoids Hassles: Minimizes inconvenience.

Simplifies: Makes tasks less complex.

Reduces Effort: Lowers energy needed.

READING 2 CLASS 10: The Ultimate Guide to Pricing Strategies & Models
Introduction:

o Pricing is vital in business strategy.

o Balancing high and low prices is crucial.
o Various models maximize revenue and profit.
Key Concepts:

o Strategies consider goals, audience, brand, and trends.

o External factors like demand and competitors matter.
o Best strategy maximizes profit and revenue.
Price Elasticity of Demand:

o Measures how price changes affect demand.

o Inelastic products maintain stable demand.
o Elastic products see demand fluctuations.
o Formula: % Change in Quantity ÷ % Change in Price.
Cost, Margin, & Markup:

o Cost: Fees from manufacturing or sourcing.

o Margin: Earnings after subtracting costs.
o Markup: Additional charge over production fees.
o Essential for cost-based pricing.

TYPES OF PRICING STRATEGY

1. Competition-Based Pricing:
 Focuses on existing market rates.
 Benchmarks against competitors.
 Effective in competitive markets.
2. Cost-Plus Pricing:
 Determines price based on production cost.
 Common in retail for physical products.
3. Dynamic Pricing:
 Flexible pricing based on market and demand.
 Utilizes algorithms for adjustments.
4. High-Low Pricing:
 Initially high prices, lowered over time.
 Common in retail for seasonal items.
5. Penetration Pricing:
 Enters the market with a low price.
 Attracts attention from competitors.
6. Skimming Pricing:
 Charges high initial prices lowered gradually.
 Common in technology for varying life cycles.
7. Value-Based Pricing:
 Prices based on customer willingness to pay.
 Boosts customer sentiment and loyalty.
8. Psychological Pricing:
 Targets human psychology to boost sales.

17
  Examples include the "9-digit effect."
9. Geographic Pricing:
 Prices vary based on geographical location.
 Useful for international markets.
Pricing Models:
1. Freemium:
 Offers a basic version free, with paid upgrades.
 Common in SaaS for building trust.
2. Premium Pricing:
 Prices products high for a premium image.
 Relies on brand awareness and perception.
3. Hourly Pricing:
 Charges based on time for service providers.
 Common for consultants and freelancers.
4. Bundle Pricing:
 Sells complementary products together at a single price.
 Encourages upselling and cross-selling.
5. Project-Based Pricing:
 Charges a flat fee per project.
 Common for consultants and freelancers.
6. Subscription Pricing:
 Charges recurring fees for regular access.
 Common in SaaS and online services.

Creating a Pricing Strategy:

1. Evaluate Pricing Potential:
 Assess potential pricing based on cost, demand, etc.
2. Determine Buyer Personas:
 Understand the characteristics and preferences of target customers.
3. Analyze Historical Data:
 Examine past pricing strategies for success and learnings.
4. Balance Value and Business Goals:
 Find a compromise between profitability and customer satisfaction.
5. Competitor Pricing Analysis:
 Study competitors' pricing to inform strategy.

• Effective pricing strategies consider various factors and industry-specific needs.

• Continuous evaluation and adaptation are crucial for success in dynamic markets

READING 3: Class 10 Dynamic Pricing

 Definition: A strategy deviating from fixed pricing, adopting variable pricing based on real-time customer
demand and supply.

 How It Works: Utilizes advanced data, considers customer behavior and willingness to pay, and involves
automation to adjust prices for maximum profits and real-time inventory management.

Types of Dynamic Pricing:

Peak Pricing: Prices change based on current supply.
Segmented Dynamic Pricing: Customer data is used to alter prices.
Customer Behavior: Prices change based on customer behavior.
18
Competitor Pricing: Prices change based on competitors' offerings.
Time-Based Dynamic Pricing: Prices change based on time factors.
Supply and Demand Based on Locality: Prices change based on geographical demand and supply differences.

Dynamic Pricing Examples:

 Airlines: Flight ticket prices vary based on remaining seats and time left for takeoff.
 Electricity: Utilities might be charged higher prices during peak usage periods.
 Hotels: Prices change based on room size, peak season, weekends, and other factors.
Advantages:
 Quick Results: Generates quicker and more profitable sales for retailers.
 Adjustable: Allows retailers to adapt to competitive pricing, improving flexibility.
 Profit Maximization: Helps sellers maximize profits by updating prices based on customer behavior.
 Inventory Movement: Speeds up clearing slow-moving inventory in real-time.
Disadvantages:
 Inventory Mismanagement: Rapid price changes can impact demand and supply, leading to inventory
management challenges.
 Customer Confusion: Constant price alterations may confuse customers, potentially leading to a loss of
market share.
 Enhanced Marketing Activity: May require increased marketing efforts to communicate price changes.
Dynamic Pricing Vs Price Discrimination:
 Prices Offered: Dynamic pricing offers the same prices to every customer, whereas price discrimination
offers different prices to different customers.
 Basis: Dynamic pricing is based on market conditions, while price discrimination is based on customers'
characteristics.

READING 4: Class 10 Principles of pricing

1. Customer Responsibility:
 Customers bearing the product cost are more price-sensitive.
2. Competitive Influence:
 Higher price sensitivity when products are perceived similarly and easy to compare.
3. Price Customization:
 Individual variations in perceived product value due to taste, preferences, and needs.
4. Understanding Perceived Value:
 Crucial to pricing; direct-response surveys assess willingness to buy at different price points.
5. Magnitude Impact:
 Greater sensitivity in high-cost product categories; influenced by dollar cost, ongoing usage, and percentage
of total cost.
6. Assessment Factors:
 Price sensitivity varies by customers, time, and products; influenced by performance, knowledge, loyalty,
and product importance.
19
the value-pricing approach is driven by a few key factors:
1. Objective Value:
 Measures the true economic benefits of a product relative to others, regardless of consumer
recognition.
2. Perceived Value:
 Consumer's understanding of a product's value, influenced by marketing efforts.
3. Substitute Pricing Impact:
 Prices of competing products influence both objective and perceived value.
4. Cost of Goods Sold (COGS):
 Essential factor; pricing above COGS ensures profitability.

There are two main methods discussed for assessing a product's value to customers:
 Objective Value Assessment:
 Utilizes cost-structure studies to evaluate a product's true economic value (TEV) relative to
alternatives.
 Perceived Value Assessment:
 Involves surveys where potential buyers directly express the value they associate with the
product, aiding in understanding customer perceptions.

LEGAL ISSUES MENTIONNED:

 Price Customization:
 Legal but raises ethical concerns.
 Studies show potential unfairness, especially impacting low-income individuals.
 Higher prices for essential goods in local supermarkets for people with limited mobility.
 High-Low Pricing Disparities:
 Concerns about pricing variations between markets or regions.
 High prices in one area and low prices in a neighboring region can trigger criticism.
 Raises ethical concerns.
 Anti-Competitive Practices:
 Actions like predatory pricing, price fixing, and price maintenance mentioned.
 Considered anti-competitive and potentially illegal.
 Can lead to government charges and lawsuits from customers or competitors.
 Ethical Review and Legal Guidance:
 Emphasizes the importance for companies to conduct ethical reviews.
 Recommends seeking legal guidance before implementing pricing practices.
 Ensures compliance with laws and regulations.

20


21