4a. Marketing Overview

“Dear Red, If you’re reading this, you’ve gotten out. And if you’ve come this far, maybe you’re willing to come a little further.” — The Shawshank Redemption

Source

If you’ve come this far, you’ve been primed to dive into more technical content.

This week, we are going to lay the foundation of good marketing knowledge. 

Products are developed in order to be sold in a market. Understanding the basics of marketing is crucial to understanding good product development processes, good product development strategies, and good product development life cycles.

Marketing gets a bad rap with a lot of product people. They assume marketing is just a fuzzy pseudo-science or that marketing is just about making commercials and posting on social media.

Marketing is just the opposite. It is a deeply researched and sound discipline. In this chapter, we’re going to cover the key items:

• What is Marketing
• The Marketing mix
• Customers, Consumers, and Segmentation
• Distribution and some other key terms

What is Marketing?

In the highest-level definition, Marketing is about meeting customer’s needs profitably.

I love this definition because it captures two critical factors:

1. Meeting customer’s needs
2. Profit

If you remember nothing else about marketing, you must remember that it is customer-focused and profit-focused.

Marketing Focuses on Customers and Money.

Main Source: Marketing Management, Kotler and Keller

4b. Some Basic Marketing Jargon

In upcoming posts, we’ll talk about markets and consumers and the like. Here are some definitions to get out of the way. You may already know these, and if so, congrats, it’s an easy read today!

Market — The total of all buyers and sellers; describes both the abstract groups as well as physical or virtual locations.

Consumer and Customer — The end-user of the product; many people use the terms “consumer” and “customer” synonymously, but technically, they’re not always the same: “consumers” use products and “customers” to purchase them.

Market Condition — Anything describing the state of the market into which the product is launching or is being sold, including the number of similar products, the retail channels, the economic environment, etc.

Segment — A sub-group of consumers in a market which shares a set of particular characteristics; e.g., a users age, such as, 40–45 with an income over $100k/yr; “a large, identifiable group within a market” (Kotler and Keller)

Demographics — Quantifiable data about a particular population of people, e.g., ages, income, etc; data about people in the market.

Psychographics — The study of people’s attitudes, interests, and opinions; see also behavioral variables.

Attitudes — Customer’s attitude, which relates to purchasing behavior, preference, what influences them, etc.; also referred to as “‘tudes” by cool kids.

Ethnography — The study of people and cultures; used in product development writing when describing studying customers and consumers in order to discover needs, preferences, and problems.

4c. The Marketing Mix

You should know these by heart. We call ’em The Four P’s of Marketing.

• Product
• Price
• Promotion (how are you promoting the product)
• Placement (where are you selling the product)

For essentially every product and service, Marketers must consider the overall “Marketing Mix” that will achieve their objectives. The most common objective is to maximize the sales of the product.

I don’t typically advocate just memorizing something, but you should memorize the four Ps. This is some important 101 shit.

4d. The Marketing Team Makes an iPhone

Let’s really learn what a Marketer does by giving an example: the iPhone (yes, a cliche example, but something most people can relate to).

Product — a marketing team would be involved in specifying the features and capabilities required. While engineering would build the technologies, marketing would dictate requirements for the total cost, for software compatibility, camera performance, battery life, and anything of a similar nature. These marketing requirements would be driven by market research, consumer insights, or whatever Steve Jobs would have wanted.

Price — is determined by marketing. Market research into competitors and other market conditions would be conducted.

Placement — Where will the iPhone be sold? In Apple stores alone, or elsewhere? The marketing team determines this.

Promotion — The marketing team would determine promotion — from commercials to launch events to press relations.

The main reason to illustrate this is to drive home the facts:

• Marketing is not just about making commercials
• Marketing is about consumers and profit
• The marketing team plays a big role in product development

4e. Book Rec and Recap

To wrap up our  Marketing 101 content, I’ll leave you with two book recommendations:

Marketing Management by Kotler and Keller.

This book is used in many MBA programs around the English-speaking world and it is a great marketing textbook. It is not a bad idea to invest in this book as it can serve you well throughout your product development career.

The Personal MBA by Josh Kaufman

Do you know the scene in the movie Good Will Hunting where he says something like “you spent a hundred grand on an education you could have gotten for a dollah twenty-five in late fees at the public library.” That’s not exactly what I’m saying, but this book is pretty close to that. It’s extremely readable and I highly recommend it.

“You couldah just bought The Personal MBA.” Source

Recapping the week

1. Marketing = Meeting customer’s needs profitably
2. The marketing mix is about the product, price, placement, and promotion
3. Jargon terms like segment (a group of customers), the customer (buyer) versus consumer (end-user), and demographics (data about people, like age, income, etc.).

See ya in the next post! And, as always, thanks for reading.