Marketing for Design Engineers: Key Concepts Prof Mary Caravella, School of Business 1(c) 2015 Prof. Mary Caravella

Marketing for Design Engineers:Key Concepts

Prof Mary Caravella, School of Business

1(c) 2015 Prof. Mary Caravella

What is marketing?

(c) 2015 Prof. Mary Caravella 2

What is marketing?

Creating, communicating and delivering VALUE to

customers, and managing relationships

with those customers to benefit the organization and

its stakeholders


We develop customer value propositions to facilitate transactions

4(c) 2015 Prof. Mary Caravella

Transaction Costs

Price

Customer Value

BrandAssociations

ServiceExperiences

ProductAttributes

Benefit Claims Cost Claims

Customer Value Proposition: The specific bundles we propose to help customers solve a problem or achieve a goal, including the benefits we claim they will receive and the costs we ask them to pay

SearchLearningNegotiationDisposal

Two key questions we will focus on

1. Will what we design create value for customers?

2. How will customers find us?


Eric Ries (2011) The Lean Startup, Crown Business

“People don’t want ¼” drill

bits, they want ¼”

holes”


Two drills on Amazon…


Black & Decker SSL20SB 20-Volt MAX Smart Select Lithium Ion Drill/Driver with extra battery

DEWALT DCD760KL 18-Volt 1/2-Inch Cordless Compact Lithium-Ion Drill/Driver Kit (includes second battery)

$118.05

$179.99

Two drills on Amazon…


SmartSelect Clutch; Choose your project icon and drill automatically adjusts power and speed for optimal results

Gear indicator; 2-speeds indicates high or low setting

20-volt MAX Lithium batteries deliver extended run-time

High torque motor delivers 175-Inch-pounds

Ergonomic design for improved comfort and control

Lightweight design (4.0 lbs) minimizes user fatigue

Dual speed range 0-500/0-1700 rpm delivers optimal performance

LED worklight provides increased visibility in confined spaces

Compact track saw batteries (DC9181) are compatible with the existing system of DEWALT 18v power tools produced since 1996

Compact size (8.2-inch) allows users to fit into tight spaces;

$118.05 $179.99

Two different brands for two different targeted marketswith different problems to be solved or goals to be achieved


Three DIMENSIONS of customer needs


Functional Social Psychological

Why does he choose specific products/services?


Because they help me• Do something

(Functional)

• Express myself with others (Social)

• Experience something enjoyable (Psychological)



I need…• A drill I can use for everything

• Assurance I am buying a reliable product



Because they help me• Improve my business (Functional)

• Market my business (Social)

• Avoid risks (Psychological)

(and I’m a person too!)



I need…• Tools I can use all day

• Rugged• Compatible

power supplies• Tools that show I’m a professional (and make me feel like one)

• Distinctive styling consistent with me

Your product is a tool to help customers create value for themselves. The more you understand customers and what they value the more likely you will create value


Functional value: helps solve a problem or achieve a goal

Social value: connects with or distinguishes from others; expresses something about self to others

Psychological value: interesting, enjoyable, anxiety-reducing, satisfying



The sensors found in smart phones and Nintendo Wii controllers have migrated into Black & Decker’s cordless 4v MAX Gyro, billed as the world’s first motion-activated screwdriver. Tilt it right by a mere quarter of an inch and it screws clockwise to tighten; left, and it turns counterclockwise—all thanks to an internal gyroscope that senses wrist motions, which are measured by a small microprocessor that turns those movements into changes in the drill’s speed and direction

Now that we better understand WHY people choose what they do, we turn to HOW they do it


HOW does he choose?


LIFE SEARCH SOLVE

DMP(decision making

process)

How a customers moves through a

decision

Life gives rise to problems and goals


• What’s going on in my life?

• What triggers this need?

LIFE SEARCH SOLVE

1.Creating Customer Value

We search for and evaluate solutions


LIFE SEARCH SOLVE• What’s

going on in my life?


• What do I already know about how to address this need?

• Who should I ask?• Where else

should I look?• What is important

to consider?

We choose, and evaluate our choice


LIFE SEARCH SOLVE• What’s

going on in my life?


• What do I already know about how to address this need?

• Who should I ask?• Where else

should I look?• What is important

to consider?

• How satisfied am I with the product/service?

• How satisfied was I with the purchase process?

• Do I get the support I need?

Need characteristics affect the DMP…


LIFE SEARCH SOLVE

Need Importance

Drives effort to get started AND increases effort spent searching

Need FrequencyDecreases effort spent searching

1: Target Segment DescriptionImplications

So they affect your marketing challenge


FREQUENCY

LO HI

IMPORTANCE

HI

Getting him started

(“I know why… how?”)

Switching to you(“Why are you

better than your competition?”)

LOGetting him

started(“Why bother?”)

Switching to you(“Why should I

change my routine?”)

We’re opening a deli, we’d like Sam to find us

(c) 2015 Prof. Mary Caravella

“I need lunch”

25

What is Sam’s “decision journey” (DMP)?

Sam likes to get outside of work during his 30 minute lunch break. He usually walks with a few of his coworkers to one of the nearby fast food places, but lately has been packing lunches– he’d like to eat healthier, but doesn’t want to make his friends change their lunch routine.


Identify key decision criteria


When Sam chooses a place to eat for lunch… What is non-negotiable? (“must

haves”) Can get in and out in 30 minutes

What other things does he consider? (potential “differentiators”) Healthy food Friends can get food they like too

Develop competitive decision matrix


Criteria McDonalds Subway Our Healthy

Deli

Differentiators

Tasty, familiar food my friends like

Fries Subs Wraps None

Healthy food Small selection

2/3 selection

Full selection

Limited selection*

Less than 10 min away

Yes No Yes Yes

Must haves

Within 30 minutes

8 minutes away

15 minutes

away

8 minutes away

0 minutes away

Pricing < $8.00 /meal

$5.00/meal $5.00 core menu

$6.00 core menu

$4.00/meal + pre time

Very useful for determining and communicating competitive

situation and product development priorities

Decision criteria affect your POSITIONING How you distinguish yourself from competitors

in your customer’s mind


Positioning Statement For (our target segment), our ( product/brand

) is (ONE important and most differentiating

decision criterion) among all (competing ways of solving targeted

problem) because ( single most important “supporting

evidence” )

Some direction..

1. Will what we design create value for customers? Work to understand all the dimensions of customer

value: functional, social and psychological, that customers evaluate against costs

Understand which product attributes are must haves and which are differentiators

Use brands to signal (and deliver) intangible benefits

2. How will customers find us? Work to understand the customer decision journey

(DMP) Understand what is most likely to trigger a search,

where they are most likely to search and what causes them to stop searching

Use brands to create mental shortcuts related to your positioning


Reach out if I can help [email protected]


Documents

Marketing for Design Engineers: Key Concepts Prof Mary Caravella, School of Business 1(c) 2015 Prof. Mary Caravella