data mining

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Advertising and Research (Part 1)

Published November 1, 2013 by Mayrbear's Lair

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Introduction

An advertising campaign’s function is to provide information about a brand in a memorable and entertaining fashion. To achieve the most effective response, marketers focus their strategic plans to develop the brand’s positioning with the message and images they choose to communicate. Shimp (2010) suggests that marketers can entice consumers in interesting ways by learning more about their wants and needs, using the information they collect to reach them more effectively (Shimp, 2010). These strategies are commonly used to help advertisers grab the attention of viewers, build trusting relationships with them, and in exchange patrons offer brand loyalty.

To find out more about a target audience media teams implement precision research systems into their campaign efforts to experience maximum benefits for their efforts. Baack and Clow (2012) contend that research systems give marketers insights into: (a) consumer purchasing habits, (b) the merchandise they use, (c) how they make purchases, and (d) other behavior that may affect their interaction with the brand. Advertisers typically focus their research efforts in two areas: product-specific and consumer-oriented data collection to better comprehend their target audience (Baack & Clow, 2012). Research strategies help marketers devise the best methods to communicate their messages more effectively to motivate consumer action. The focus of this study is centered on three academic disciplines that play an integral role in advertising research to help in the development of an effective marketing campaign: (a) data driven management systems to help support brand positioning, (b) the implementation of direct response marketing programs to assist with goal setting strategies, and (c) applying personal selling tactics that can have a profound effect on budget allocation. In addition, the study will also examine how components like data mining, customer profiling, trawling, and frequency programs are important for building customer relationships to help with research efforts. The findings of this study will conclude that companies who implement a disciplined advertising research program which includes strategies to individualize communication with consumers, will experience more success from their efforts. These programs can help address important issues that will influence the development of their promotional campaigns which in turn has an impact on the brand’s positioning, goal achievements, and budget plans.

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Data Management and Brand Positioning

Media experts look to position their brand more effectively by including strategic disciplines in their advertising research efforts. King and Young (2010) explained that a brand’s position communicates the benefits, their image, and the key advantages they represent in the way they want to deliver that message to the collective mind of their target audience. In order to determine their brand positioning in the core of their message, they must provide a tangible reason their brand stands out above the competition (King & Young, 2008). To position themselves above others, marketers begin by conducting thorough research on their competitors and collect substantial data to profile consumers as a means to better comprehend the marketplace. This strategy is also effective to help to establish trustworthy relationships with their patrons.

The first step for a marketing team is to incorporate strategic data driven systems into their research programs. To achieve this task, teams begin by developing a strong data warehouse that includes coding analysis capabilities which can also be used for data mining procedures. Data driven marketing provides a direct link to consumers and helps advertisers develop more effective relationships with their audience. For instance, because of advances in internet technology and software development, companies can easily build and develop strong database programs that support and personalize customer interaction to build loyalty. Technologies that support database storage, mining and coding operations are more effective in building intimate relationships with consumers because they keep track of their interaction with the brand. For example, a brokerage firm that has established a customer profiling program may use database mining strategies to implement a practice called trawling. This procedure helps companies identify active patrons and pinpoints the inactive ones. It also helps strategists determine whether clients should be pursued and enticed into new action or released to make room for others. Companies that incorporate data driven marketing strategies into their research programs do so to understand consumer values so they can build better relationships with them and increase their chance of elevating their brand position in the marketplace.

Part 2 to be continued next Monday … thanks for staying tuned!

References:

Baack, D., & Clow, K. (2012). Integrated advertising, promotion, and marketing communications (5th ed.). Upper Saddle River, NY: Pearson Education, Inc.

Eyun-Jung, K., Hyoungkoo, K., & Lan, Y. (2012). Social media research in advertising, communication, marketing, and public relations. Journalism and mass communication quarterly, 89. Columbia, USA: Association for Education in Journalism and Mass Communication. Retrieved October 16, 2013, from http://search.proquest.com/docview/1026654509?accountid=32521

King, P., & Young, C. (2008). The advertising research handbook (2nd ed.). Seattle, WA: Ad Essentials, LLC.

Shimp, T. (2010). Advertising, promotion, and other aspects of integrated marketing communications. Mason, OH: South-Western Cengage Learning.

Thomas, J. (2013). Advertising research. Retrieved October 17, 2013, from http://www.decisionanalyst.com: http://www.decisionanalyst.com/publ_art/adver.dai

Market Segmentation

Published October 11, 2013 by Mayrbear's Lair

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Most experts agree that effective marketing campaigns communicate their messages directly to their intended audience. McDonald (2012) suggests that in addition, the objective of a successful advertising campaign is to gain the competitive advantage by building a loyal customer following providing them with products and services that meet the demands of clearly defined markets. Many advertisers fail to reach their target audience, however, because they rarely focus beyond the basic demographics. In addition, the complex arena of today’s marketplace presents many challenges for companies trying to identify their target audience. To address this, marketers implement various strategies of segmentation to divide potential consumers into different market groups recognizing that not all customers are created equally (McDonald, 2012). The focus of this research is centered on the importance of market segmentation and the components that are utilized to help companies develop a detailed understanding of their arena. For the sake of this analysis, the Apple Corporation’s iPad is included as an example product to help illustrate how marketers incorporate a variety of target market segmentation practices to help them develop their marketing campaigns. In addition, the study will also look at how core messages can be implemented to support these campaigns. The findings of this research will conclude that market segmentation is a strategy that can help corporations stop wasting money on ads that do not reach their intended buyers and is effective in helping companies identify their target audience.

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Definition

Market segmentation is an important component because it helps advertisers reach their core audience and turn them into advocates for their products and services. Many leaders know that advertising is a significant business strategy that fulfills a fundamental purpose. Gallagher and Zoratti (2012) explain that the marketing process: (a) defines markets, (b) quantifies the needs of customer groups within these markets to determine the value propositions, (c) communicates these value propositions effectively to those in the organization responsible for delivering them, (d) deliver these value propositions, and (e) monitor the value that is delivered. Many of today’s top performers in business are committed to consumer focus strategies. This is achieved through extensive data mining, analysis, and enriched profiling utilizing outside data sources in addition to behavioral, transactional, and conversational tracking methods. These strategies are designed to help companies define their markets and understand their value. These methods typically include incorporating: (a) the corporate mission and objectives which in turn helps determine markets of interest, (b) external data such as market research, and (c) internal data which flows from ongoing operations. The organization then processes this information and divides it into segments of consumers with similar needs so they can also predict future behavior (Gallagher & Zoratti, 2012). In other words, marketers gather sufficient data from consumers to help them quantify the needs of consumer groups to determine value propositions. Marketers then communicate their message implementing the company’s core values in their propositions to the appropriate parties in an effort to inspire action.

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Applications

Market Segmentation

Market Segmentation is one of the most efficient strategies available to advertisers because it helps them develop a unique selling proposition. Kennedy (2011) postulates that because of advances in technology, many companies have issues identifying the most appropriate media for the delivery of their message to prospects. In fact, most use media because that is the traditional course. This approach is both ineffective and inefficient. To construct a marketing campaign that conveys a powerful message, leaders must conduct a thorough survey of all the components they are up against (Kennedy, 2011). In short, their goal is to design a message that translates into a transformational experience that trumps all others and places them in their own category. One way to achieve this is to divide consumers into separate groups. For example, Baack and Clow (2012) explain that the foremost method of segmentation implemented employs demographics, or the characteristics of the inhabitants of that region. Typical examples include gender, age, education, income, and cultural ethnicity. Organizations use this information to construct products and services that meet specific demographic segments (Baack & Clow, 2012). For example, when the Apple Corporation introduced the iPad tablet as a new product, the goal was to convince their target audience that the new electronic devise was the future of computer technology and designed their campaigns to transmit that message effectively. Apple’s core message communicates their commitment to bring consumers the best products. In exchange for keeping their promise to deliver high quality merchandise, consumers agree to pay higher prices to support these innovations. Apple marketers that design their campaigns using market segmentation as a model will focus their campaigns based on the demographics of consumers that have the most influential buying power, which for this product could include such factors as income, education, geography, and age.

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Product Segmentation

Product Segmentation can help companies stop wasting money on campaigns that do not reach intended buyers. Godfrey (2007) purports that retailers need to present their products in ways that consumers can efficiently search and select them. The WalMart Corporation, like many large retail outlets, sells thousands of merchandise in a variety of categories including electronics, grocery, household, and personal care items. Their core value is transmitted in their company tagline: save money, live better. To help them keep their promise they must have knowledge and insight on consumer spending habits. One way the retail giant does this is by implementing a variety of segmentation techniques to better serve their clientele in a way they can discover more about them. First, their strategy identified and separated consumers into the following six categories as their target audience: Hispanics, African-Americans, Suburbanites, Rural Residents, Affluent, and Empty-nesters. Next, the store designed their layout by segmenting their products and organizing them into various categories. To enhance the shopping experience, for instance, merchandise is organized into collections of products to attract each target audience member. In other words, they present their merchandise in a way that is more appealing to target consumers by incorporating a methodology that identifies consumer behavior. This strategy helps them match consumers to specific groups of services and products (Godfrey, 2007). Retailers refer to this practice as product segmentation because they group and display products strategically in a manner that attracts a certain type of clientele. For example, consumers seeking the iPad tablet will find them situated in a specific location of the retail outlet with other popular electronic devices. These items are strategically placed where the eyes can find them quickly and easily. However, in keeping their promise to deliver high end merchandise, the Apple products are placed only where employees can access them under lock and key for security purposes. This is one example of how product placement and segmentation provides a significant model to help identify and serve target consumers more effectively.

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Generational Segmentation

Generational segmentation helps marketers identify groups of consumers that share similar experiences from common events. These occurrences help create bonds in individuals of a similar age group. Baack and Clow (2012) contend that similar experiences in certain age groups impact consumer perceptions, penchants, and social morals (Baack & Clow, 2012). Generational segmentation is one way Apple Corporation marketers, for example, can transmit their campaign messages to motivate a target audience to take action.  Apple’s website clearly states that their core message is a commitment to produce quality products. To demonstrate this concept, the promotion department may create a strategy to transmit that message to the Older Boomers age group for instance.  A campaign targeted at them would be developed in a different manner than a campaign that targets Generation Y, for instance, because each age group evolved with a different set of experiences. For example, Older Boomers grew up with TV shows like Star Trek. Knowing this, marketers can use this factor to influence their interest in iPad products because they remind them of the devices their heroes used in the show.  On the other hand, a marketer would appeal to Generation Y consumers based on the exciting new apps and features as the next evolution of the electronic devices they grew up with. Generational segmentation is an effective strategy that is utilized to help marketing experts transmit relevant information to the intended consumer.

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Benefit Segmentation

Benefit segmentation focuses on customer benefits or improvements that are provided by a product or service. Baack and Clow (2012) propose that demographic and psychographic information are united with benefit data to help identify these groups so that marketers can analyze further variables that affect their audience (Baack & Clow, 2012). For example, another strategy Apple Corporation marketers can develop to promote their product is one that highlights the benefits of the new iPad by comparing it to other tablets and portable laptop computers available on the market. Some of these benefits may focus attention on components like the larger viewing display, the lightweight design, and that it is more compact than laptop computers. Marketers that feature product benefits in their campaigns can attract consumers effectively. A company in the health care industry, however, like the Chopra Center, that wants to transmit the benefits of their facility and services to consumers, would implement completely different segmentation strategies based on the consumer’s desire to improve their fitness and maintain a healthy lifestyle. The Chopra Center in San Diego is designed and operated by licensed physicians and medical practitioners for a specific target audience. Chopra Center marketers for example, would identify individuals that are experiencing health issues who are looking for alternative methods in health care. The Center’s core message is to serve as a global source for balance, healing, transformation, and the expansion of awareness (Chopra & Simon, 2013). This is stated clearly on their website and in their promotional material. This declaration helps to provide consumers with confidence and security in the organizational management of their institution. As a medical facility that offers both products and services, it is important that their marketing campaigns keep their promises and are designed to protect them from fraud and liability issues that may arise. Companies that incorporate benefit segmentation are focused on fulfilling consumer needs based on a desire to improve their life in some manner.

Conclusion

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Leaders that acknowledge the concept that markets are not homogenous and use market segmentation strategies are in a better position to standout in their industry and maintain a competitive edge. Baack and Clow (2012) purport that developing effective targeted advertising is the key to a successful marketing campaign. Marketers that identify their target audience by implementing precision plans to influence consumer: (a) awareness, (b) knowledge, (c) liking, (d) preference, (e) conviction, and (f) the actual purchase, are significant elements that impact consumer buying power. These strategies are designed to impact consumer cognitive, affective, and conative components in an effort to produce a powerful feeling or experience that motives them to take action (Baack & Clow, 2012). The findings of this research conclude that market segmentation is an effective strategy that helps corporations stop wasting their advertising investments on campaigns that do not reach intended buyers, and plays a significant role to help them identify a target audience.

Next week my research work is centered on advertising strategies and media buying. Stay tuned … until then, have a great weekend everyone!

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References

Baack, D., & Clow, K. (2012). Integrated advertising, promotion, and marketing communications (Fifth ed.). Upper Saddle River, NY: Pearson Education, Inc.

Chopra, D., & Simon, D. (2013). The Chopra Center for Well-Being. Retrieved July 14, 2013, from The Chopra Center for Well-Being: http://www.chopra.com/welcome-chopra-center

Gallagher, L., & Zoratti, S. (2012). Precision marketing: Maximizing revenue through relevance. London, UK: Kogan Page Ltd.

Godfrey, A. L. (2007). A product segmentation approach and its relationship to customer segmentation approaches and recommendation system approaches. ProQuest Dissertations and Theses. Ann Arbor, MI, USA. Retrieved September 25, 2012, from http://search.proquest.com/docview/304811614?accountid=32521

Kennedy, D. (2011). The ultimate marketing plan: Target your audience (Fourth ed.). Avon, MA, USA: Amazon Digital Services, Inc.

McDonald, M. (2012). Market segmentation: How to do it and how to profit from it. Chichester, West Sussex, UK: John Wiley & Sons.

Target Market

Published October 7, 2013 by Mayrbear's Lair

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Marketers that approach advertising with a strategy to target everybody will face many obstacles. An effective marketing campaign is designed to clearly communicate a message to the right people through the proper channels in order to experience the highest level of profitability. Kennedy (2011) explains the most efficient marketers build their campaigns in powerful, persuasive, and compelling ways to attract the attention and captivate their viewer. Another significant aspect of developing a campaign is to determine precisely who the message is for and design the best method to present it to them (Kennedy, 2011). In short, successful campaigns include two important components to achieve the best results: (a) delivering a powerful message and (b) delivering it to the relevant people.

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Because of the internet and advances in technology in today’s competitive culture, a great marketing message is more important than in any other time in history. A creative who designs a campaign to target everybody will not transmit their message efficiently to the people who need to hear it the most. For example, an advertisement about make-up is only relevant to people who use it. This ad would be wasted on members of society that do not wear make-up. Baack and Clow (2012) suggest the most effective marketers analyze their target audience and design their campaigns to persuade relevant consumers to inquire about their services or products. The information companies gather from consumers allows them to serve their needs better. This strategy enables them to develop a campaign that speaks directly to the consumers who may have an interest in their services or goods (Baack & Clow, 2012). Taking this information into consideration, most creatives design their ultimate marketing plans to promote and combine powerful messages that authentically represents the company’s goods and services.

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Many of today’s advertising giants have one thing in common: commitment to customer focus strategies derived from rigorous customer insight. Gallagher and Zoratti (2012) purport that one way this is achieved is through separating consumers into groups by data mining, analysis, and detailed profiling that implements third party data resources. This strategy is in addition to behavioral, transactional, and conversational tracking. This is known as precision marketing. Rather than allocating large budgets for mass campaigns that treat everyone in the same manner, precision marketers are mining customer data for spending predispositions and propensities in order to target buyers in an exceptionally sophisticated manner (Gallagher & Zoratti, 2012). In other words, all communication received can be used for segmentation to target relevant data to the intended recipient. Marketers that include segmentation as part of their advertising strategy produce higher results than those who do not. For example, when a person with a Facebook profile indicates their interests by liking different pages, this information is gathered so that the next time a person logs in, there are ads strategically placed to target that individual’s interests. By gathering and segmenting data, marketers are better able to reach their intended audience to produce more successful results.

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References:

Baack, D., & Clow, K. (2012). Integrated advertising, promotion, and marketing communications (Fifth ed.). Upper Saddle River, NY: Pearson Education, Inc.

Gallagher, L., & Zoratti, S. (2012). Precision marketing: Maximizing revenue through relevance. London, UK: Kogan Page Ltd.

Kennedy, D. (2011). The ultimate marketing plan: Target your audience (Fourth ed.). Avon, MA, USA: Amazon Digital Services, Inc.