Eight Demand States with Respect to Bifocal Lenses for Glasses - Assignment Example

MARKETING MANAGEMENT ………………….. ………………………. ………… Discuss the eight demand s with respect to bifocal lenses forglasses. Companies are focusing more on effective marketing strategies in order to respond to consumers’ on-demand expectations. Marketers are those who not only seek a response (attention, purchase, vote or a donation) from another party, but also stimulate demand for a company’s products (Kotler and Keller, 2006, p. 10) through a number of different strategies and marketing techniques. Marketing managers are responsible to evaluate demand levels and manage it effectively, by influencing the level, timing and composition of demand to meet company’s specific objectives. Eight demand states in marketing of bifocal lenses are detailed below: Negative Demand: A product is said to face negative demand when a significant segment of the market dislikes it and even pays to avoid it (Kotler and Keller, 2006, p. 10). The fundamental task of marketing managers in this situation is to find out the reasons for this negative demand state to the product and take effective measures to counteract them (Sandhusen, 2000, p. 59). People in some countries have a negative demand for vaccination, but, it is very unlikely in the demand for bifocal lenses. No Demand (Nonexistent demand): When the target-market customers are unaware or are uninterested in a product, it is called no demand state (Kotler and Keller, 2006, p. 10). The main task of marketing managers in this state will be to connect potential product benefits to the needs and wants of the target-customers. This is also very unlikely in the case of demand for bifocal lenses, because, people are well aware of it. Latent Demand: It is when many prospective consumers share a strong need but that cannot be satisfied by the existing product (Kotler and Keller, 2006, p. 10). For example, demand for hair restoratives and painless diets (Sandhusen, 2000, p. 59). The marketing manager is, in this state, expected to measure the potential demand and develop products accordingly. Currently, sufficient quantities of bifocal lenses are available in the market to satisfy prospective demands for it. Latent demand is often described as a vague want (Baker, 1998, p. 80). Declining Demand: It is a state in which customers begin to buy a product less frequently or not at all (Kotler and Keller, 2006, p. 10). Even though demand for bifocal lenses is not declining, some factors can likely cause it in the future. In this case, the marketing management is responsible to analyze reasons and project better strategies to counteract the trend. Irregular Demand: This occurs when seasonal, monthly, weekly or daily demand fluctuations cause major changes in the product usage (Kotler and Keller, 2006, p. 10). For example, some transit system or restaurants often face rush hour peak demand or high occupancy season. The demand for bifocal lenses is never irregular. Full Demand: It occurs when consumers are buying all the products put in to the marketplace (Kotler and Keller, 2006, p. 10) and thus the firm has all the business it needs. If a firm selling bifocal lenses experiences full demand, the marketing manager is responsible to maintain competitive advantages. Overfull Demand: It occurs when the demand is higher than the quantities that the firm can or wants to handle (Sandhusen, 2000, p. 60). If a firm selling bifocal lenses for example, experiences overfull demand, the marketing manager can discourage it by manipulating marketing mix variables. Unwholesome Demand: It occurs when consumers are attracted to products that have undesirable social consequences (Kotler and Keller, 2006, p. 10)., like cigarette or alcohol. As bifocal lenses have no undesirable social consequences, it is very unlikely in the case of bifocal lenses. Describe the LOHAS (an acronym) lifestyle described in the text and its usefulness in marketing. Consumers in today’s marketing environment are highly concerned of a number of significant factors like lifestyle, health, fair trade, environmental protection etc and therefore marketers make closer look at consumers’ attitude, behavior and perception about their products. Marketers find their consumers through different segments as well so that they can establish more successful marketing strategies to reach their targeted consumers more accurately. Consumers are segmented according to their purchasing power, purchasing attitude and conscientious too. LOHAS, an acronym for ‘Lifestyles of Health and Sustainability’, is defined as a market segment focused on health and fitness, the environment, personal development and social justice (Einstein, 2007, p. 206). LOHAS comprises of group of consumers, with more than 50 million people in the US, who make conscientious purchasing and investing decisions based on social and cultural values (Howard, p. 58). Products like organic foods, drinks, energy-efficient appliances, alternative medicine and service like ecotourism are some of the major categories that come under LOHAS marketing segment that has accounted as $230 billion market in 2000 (Kotler and Keller, 2006, p. 183). LOHAS consumers are highly passionate about the environment, health, social issues, sustainability, product usefulness, utility, and so on and this increasingly influence the way businessmen shape their marketing strategies and business. A large number of companies like Apple Inc, Coca Cola and Starbucks have turned their business strategies in to ‘go green’, by setting up their very own Corporate Social Responsibility. Novacovici and Woofter (2008) described that LOHAS marketing segment is often on the leading edge of the consumer trends and hence influencing the marketing as a whole (p. 113). The LOHAS consumers have shown to be willing to spend more on products that can meet their expectations of sustainability, health and social justice. As these consumers have shown willingness to spend more on products of those companies that take sustainability a serious matter and communicate that commitments effectively to its prospective consumers. Usefulness of LOHAS in marketing LOHAS has recently become a strategic marketing tool as many companies find it effective way to identify and evaluate its prospective buyers, collect information regarding the sustainability of its products etc. The emergence of LOHAS consumer segment has eventually led to a business revolution among responsible businesses across many industries. The LOHAS segmentation, its wide acceptability and increasing trends towards it show that millions of consumers have almost same perception for a particular goods or service. This can ultimately lead to make companies more aware of what kind of products to be designed, developed and marketed. Due to the increasing importance of LOHAS, companies take various quality control and quality assurance measures in order to avoid any discrepancies and quality issues associated with goods and services and thus they are prompted to keep a ‘standard’ always. Green (2006) found that companies that target LOHAS market segment sell resource-efficient, valuable and healthful products like organic foods, personal care products, green cleaning products and eco-tourism etc (p. 194). List and discuss the characteristics of these four differentiation strategies Strong brand and often brand differentiation are critical to the business success. A large number of companies worldwide dominate in the market and maintain sustainable competitive advantages due to its branding and brand differentiation strategies. One of the very basic strategic decisions of marketing management is its branding so that it can communicate its name, phrase or image (Kerin, Hartley and Berkowitz, 2005, p. 299) to its prospective consumers. Differentiation strategy is used when brands aim at distinguishing themselves from the prototype brand in one or many dimensions that are relevant to the specific consumer segment (Franzen and Moriarty, 2008, p. 172). Kotler and Keller (2006) found that differentiation strategy is highly important to avoid the commodity trap (p. 318). Four Differentiation Strategies 1- Product Differentiation: Brand differentiation can be done through product differentiation. Products can be differentiated on the basis of various products dimensions like its features, performance, configuration, durability, reliability, design, color or service dimensions such as delivery, customer consulting etc (Kotler and Keller, 2006, p. 319). A product can be said to be differentiated when two or more products are perceived by consumers to be close substitutes but not as perfect substitutes (George, Joll and Lynk, 1992, p. 213). The main advantage of product differentiation is more general brand positioning as well as achieving increased earnings through high quality products or premium services. 2. Personnel Differentiation: Human capital is one of the most powerful resources of a business organization as it can help a business gain competitive advantages if they are better trained (Kotler and Keller, 2006, p. 320), highly committed and well knowledgeable as well. companies can differentiate its brand and gain a distinctive positioning among the customers through hiring highly trained and knowledgeable staff, because, the employees’ performance, approach to customers, reliability, responsiveness and communication skills are significant factors in differentiation strategy (Moore and Pareek, 2006, 150). For example, McDonald has become familiar brand as ‘its people are courteous’ and IBM has become known as ‘its people are professional’. 3. Channel Differentiation: Distribution channel often plays vital role in determining whether the marketing is successful or not. Similarly, marketers can achieve sustainable competitive advantages through designing and mapping their distribution channel and performance. A very good example, until recently, was Dell which has been depending on ‘direct marketing distribution strategy and therefore its brand has been differentiated due to its ‘go direct’ model. Apple has introduced its ‘own store’ strategy for gaining more accurate and easy access to customers, with an aim of facilitating digital music enjoyment at its stores. This is also an example of achieving brand differentiation through channel differentiation. 4. Image Differentiation: Various companies use attractive images to market their products. Consumers respond differently to the brand images and they often identify products or services by attributing such images too. When a company uses an image for marketing its products, it helps the company establish a specific product characteristic, communicates this character in an attractive way and passes an emotional power aligned with the image (Kotler and Keller, 2006, p. 321). Brand thus can be differentiated by using different images while marketing a company’s products or services. 4. Describe the “customer-value hierarchy” and identify the five levels of product contained within. Various products and services are marketed because consumers have a large number of needs and wants that are to be satisfied. Some customers satisfy their specific wants with some products available in the market where as some others may not. It simply means that ‘value’ of a product can be very different from customer to customer. However, the marketer, in the strategic planning process, is responsible to consider five products levels through the perspective of ‘customer value’. There are basically five product levels and each level adds more value to the customers. It means when a customer buys a product, he enjoys five values that can be combined as ‘customer-value hierarchy’ (Woodruff and Gardial, 1996, p. 64), as shown in the figure above. The fundamental value level is called Core Benefit, which the real benefit the customer is aiming to gain from that product. A resort or a restaurant customer, for instance, is buying ‘rest’ which is the core benefit of his purchasing. He spends his amounts basically for ‘rest’, however, the marketer has to turn his attention in to a number of customer values to be associated with the basic value (Kotler and Keller, 2006, p. 372). In the second level, the strategic marketing manager is to design the core benefits in to the basic product characteristics. Though customer buys ‘rest’, it cannot be fulfilled without facilitating sleep, rooms, bathing, refreshing etc. The marketer should also facilitate some other features or qualities, that are normally expected by the customers, other than the basic benefits. For instance, the customer who buys ‘rest’ would certainly expect clean and fresh water, clean environment, better ventilation etc. if these values are provided along with the core benefit value, then, the customer can be said to have enjoyed his ‘expected benefits’ as well (Kotler and Keller, 2006, p. 372). Providing something more than what has been expected by the customer has become critical gaining competitive advantages. Customers expect ‘mouth fresh, or small treat’ when they buy chocolates, but, when they experience an emotional excitement, or mental satisfaction, the product can be said to have met ‘augmented product’ value. In today’s competitive market landscape, marketers are responsible to provide something more than the expectations of the customers so that it can help gain a better ‘brand appeal’ from its customers (Kotler and Keller, 2006, p. 372). Normally, products are differentiated on the basis of product augmentation, because, different products must be different from customers perspectives and therefore marketers develop or design different values and benefits that are not generally expected by the customers. Apart from the core benefits, basic product values, expected and augmented values, there can be some benefits that are likely to arise in the future. The potential product value encompasses all the possible augmentation values as well as any product benefits that may come in the future (Kotler and Keller, 2006, p. 373). References Baker, M. 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B and Gardial, S (1996), Know your customer: new approaches to understanding customer value and satisfaction, Illustrated edition, Wiley-Blackwell Read More