Marketing

Overview

Marketing refers to the activities that a company uses to engage its target customers. This includes elements of branding and sales, as well as the analtyics necessary to understand product market fit and optimal pricing.

From a firm modeling perspective (supply side vs demand side), marketing is responsible for modeling and managing the demand side, that is, the amount of product that consumers will buy at different price points.

Of course, customers respond to factors other than changes in price. Customers also respond to sales and marketing campaigns designed to make them aware of the firm and its products. Marketers analyze the customer response in order to optimize its advertising spend.

Marketing Analytics

• Product Analytics
  • Demand Forecasting and Price Dynamics refers to the interaction between the price of a product, and the amount that customers buy at that price. It represents the demand curve in the supply and demand relationship.
  • Customer Satisfaction - typically measured through the use of surveys asking a customer's satisfaction with the product or service.
• Customer Analytics
  • Customer Experience : is a key concern of the marketing department. It is the recognition that the product or service being sold encompasses all the interactions that the customer has with the firm, and not just the product or service in and of itself.
  • Market Segmentation - refers to segmenting a company's customers into a set of groups with shared characteristics that help to explain the customer behaviour, for instance by age or income.
  • Basket Analysis - Analyzes which products tend to be purchased together.
  • Customer Churn - percentage of customers who stop purchasing a product over the course of a specified period (often a year)
• Campaign Analytics - the analysis of the effectiveness of a given marketing campaign
  • Impressions - a count of the number of times potential customers are exposed to the product, typically as web site views, commercial or print ads.
  • Purchase response is a forecast of how customers will respond to marketing activities (in addition to pricing) in terms of their purchasing behaviour. That is, if a firm increases some sales activity, such as mailings or sales calls. The question then becomes, how much does sales increase in response to the new marketing activity.
  • Take Rate - percentage of customers who accept an offer
• Brand Analytics
  • Awareness - ability of a customer or potential customer to recall a brand.
• Financial Metrics - when analyzing the effectiveness of a marketing campaign, it is common to use a set of financial concepts
  • ROI - return on investment
  • Present Value
  • Internal Rate of Return

Marketing Strategy

• Branding - a cultivated image that the customer has of the company or product. Typically used to communicate quality or values.
• Positioning

Marketing Tools

• Marketing Surveys are a series of question and answers that are posed to customers or likely customers in order to understand customer needs and/or the customer experience with the company and its products.
• Marketing Campaigns