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Design and Business..


Design and Business.. What did we do again?! – PowerPoint PPT presentation

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Title: Design and Business..

Design and Business..
  • What did we do again?!

What did we do last year..?
  • We completed a Market Situation report which
    involved examination of a Market sector
  • Market sector overview
  • Competitor Analysis
  • User Analysis
  • Consideration of Brand Values
  • Considering market objectives and there effect on
    New Product Design and Development.
  • Making product commercially successful.

What was a strategy..?
  • Design only works as part of an integrated
    company strategy.
  • A strategy is a business tool that helps to give
    an overview of a companies activities internally
    and externally
  • It is the driving force behind a companys
    development in their market and could be
    described as a master plan for success!

What does a strategy include?
  • Business objectives
  • Market objectives and strategy
  • Design or product strategy
  • Plan for managing these objectives to achieve
  • Includes details of resources and financial
    backup needed to achieve these goals.

Specifically we examined
  • Market Strategy
  • Design Strategy
  • The relationship between the two to allow for
    commercially successful products.
  • How these two diciplines work toward both the
    internal and external factors that effect
    successful business

What does it consider?
  • Internal and external factors that effect design
  • How design can be used to give the company
    competitive advantage by differentiating product
    or creating a new market niche.
  • How this will be managed and implemented.

Internal Factors..
  • Management
  • Research and Development
  • Time Scales
  • People and Skills in-house
  • Culture for Design
  • Cash and Investment
  • Production Capabilities
  • Communication

External Factors..
  • Competitors
  • Trends and Fashion
  • Market Research
  • Product Life Cycles
  • Sales
  • Target Market
  • Technology
  • Brand Identity
  • The Future

Examples of Strategic Development..
  • IKEA
  • Strategy for cost effective, high quality design
    - available to the masses, competing on price,
    trends and creating a market niche too!
  • Strategy for developing significant brand
    identity that is co-ordinates business effort.

Black and Decker..
  • Developed a product development scheme that
    introduced ergonomic considerations to new ranges
    of product and specific user trends.
  • Responded to increased consumer demand for tools
    for DIY, that is still booming.
  • Have used strong position in the market to
    diversify product offering.

Apple Macintosh..
  • The I-Pod.
  • Great design, simple interface and lots of
  • Massive Product Diversification
  • High price point latest technology
  • High profile marketing campaign
  • Now using strong reputation from quality of
    products to break into new markets..

  • In the UK and Global market place, companys that
    use design successfully, succeed.
  • Companies Develop Strategies that help them
    culminate information about their market and
    specifically target consumers and the market
  • Integral to these Master Plans is a design
    development strategy.
  • Internal and external factors must be considered
    when planning company strategy it must be
    in-touch with the market!

The Marketing Concept
  • Concerned with determining the needs, wants and
    values of a target market and directs a company
    to delivering the desired satisfactions more
    effectively and efficiently than its competitors.

Core Marketing Aims
  • Needs, wants and demands (what people want)
  • Products and Services (What you provide)
  • Value, Satisfaction and Quality (How you provide
  • Exchange, Transactions and Relationships (How you
    keep providing it)
  • Markets (Where you provide it)!

Understanding Markets..
  • The difference between marketing and a market.
  • Marketing is the activity and comprehensive
    function of many interrelated activities, aimed a
    profitably fulfilling the needs of a chosen
    customer group
  • A market is simply a term for a set of actual and
    potential buyers of a product.

Specific Markets..
  • A Market consists of buyers that normally share
    similarity or common characteristics. They can
    be simply described as follows
  • Geographic The British Market, The European
  • Product Based The computer and video games
    market, The car market.
  • Need based The home security market
  • Or combinations The European car market.

Markets, Products and Services.
  • Classifications of Markets include both consumer
    and industrial markets.
  • Consumer Market Households that buy and use
    goods or services for themselves.
  • Industrial Markets Organisations who buy and use
    goods or services for themselves, commercial
    organisations and nationalised industries.

Markets, products and Services.
  • Products and Services are the basis of and
    organisations offering to a chosen markets. The
    Service sector dominates industry in the UK, as
    with most developed countries.
  • A product an tangible item to the consumer.
  • A service an intangible benefit received by the
    purchaser. E.g. insurance.

The big questions..
  • What business are we in? Type, size, sectors,
    competitors, geographic location, current
    economic status, business potential etc.
  • What needs are we going to serve? Customer
    profiles, market strategy, segmentation,
    product/service planning, NPD, market research,
  • Where do we want to go? Business planning and
    objectives, financial management, resources,
    adequate staff, potential for expansion,
  • How are we going to get there? Overall strategy,
    product range and service offerings in tune with
    market needs and wants, coherent brand identity,
    design strategy, set out into long term and sort
    term objectives.

STP Segmenting, targeting, positioning.
  • The heart of the modern marketing is based on the
    principles of Segmenting, Targeting and
  • Market Segmentation is the recognition that
    customers in a market area or sector are not
    homogenous. And follows these basic premises
  • Customers are different
  • Differences in customers relate to differences in
  • Segments of customers can be isolated within the
    overall market and targeting specifically.

Why segment markets?
  • Better matching of customer needs
  • Enhanced profits
  • Better opportunity of growth
  • Retention and good relationship with customers.
  • Targeted communications, good brand associations.
  • Stimulation of innovation!
  • Market share is maintained.
  • Excellent target for gathering specific market

Market segmentation..
  • We know that companies place high emphasis on
    analysing market sectors and dividing them up
    into areas of specialisation.
  • These segments can be focus on and define the
    target market and its demands.
  • Therefore its critical to get an accurate
    appraisal of your market segment.

Market segmentation..
  • Marketing uses research and analysis techniques
    to define demand patterns of specific buyers.
  • Basically What product is demanded, by what
    people and why it will be brought.
  • Companies use this to target sectors in different

  • Mass Markets (undifferentiated)
  • Multiple Niche (differentiated)
  • Market Niche (concentrated)

Market research and Analysis
  • Techniques used to define market segmentation.
  • Geographic region, climate population density.
  • Demographic come back to this!
  • Behavioural Attitudes, knowledge, loyalty,
  • Psychographic Personality, lifestyle.

  • Relates to specific data to do with population.
  • Considers..
  1. Age
  2. Sex
  3. Education
  4. Occupation
  5. Family size
  6. Lifestyle
  7. Income
  8. Religion
  9. Nationality

  • Different age groups want different things and
    have different needs.
  • In recent years the competitiveness of markets
    has led to more specifically targeted age groups.
  • Age groups doesnt just apply to human
  • So lets have a look at some demographic

Family life cycle..
  • Bachelor Stage young, single, living at home
    Few financial commitments, recreation and fashion
    orientated. Buy Cars, entertainment, holidays!

Full nest 1 youngest child under 6 years old
  • House buying is important, liquid assets are low,
    dissatisfied with level of savings and financial
    position generally. Buy Medicines, toys, baby

Empty Nest 1
  • Home ownership at peak. Financial situation is
    good, savings increased. Interests in travel,
    recreation and self-education. Buys More
    expensive Holidays, luxuries and home

  • Class though less relevant these days!
  • Manual, Skilled, Semi-Skilled, Professional.
  • Linked to income (obviously)
  • Though not always in disposable income! family
    life cycle!

Targeting Markets..
  • So we have used demographic study methods to help
    define market segments within a market sector.
  • Now we need to target a particular segments and
    assess them to see which will be the most
    respondent to our product.

Marketing Intelligence
  • This feeds into the strategic planning processes
    companies use, that we discussed last week.
  • Market intelligence continuously reviews market
    segments your company is targeting, giving
    updates on changes that affect your plans!

Targeting.. How?
  • Once you have segmented your market into groups
    of users, all with specific demands, you can
    split them into those that will be most receptive
    to your product or service and those which may be
    less profitable to target. Using you most
    receptive segments you can them tailor your
    strategies to target effectively. If your
    research and strategies are correct, that you
    stand a good chance of making headway. Remember
    the battle scenario..
  • Now you have researched and understood your
    market, you can begin to formulate a strategy.

  • By analysing how Apple have used market research,
    product development and market strategy we can
    begin to see how they have understood the market
    they are in, and responded to it!
  • Remember that marketing is
  • Marketing is a management process responsible
    for identifying, anticipating and satisfying
    customer requirements profitably
  • (Chartered institute of marketing definition)

The Marketing Mix..
  • The ingredients of the marketing mix
  • Product
  • Price
  • Promotion
  • Place
  • The four Ps

Marketing Mix
  • What is the marketing mix for?
  • The way in which differential advantage may be
    achieved and sustained by manipulating the four
  • There are more Ps but we are focusing on the
    main four.

Marketing Mix..
  • Product Product management, New Product
    Development, Branding and Packaging.
  • Price Cost, Discount Structure, Terms of
  • Promotion Advertising, Sales Promotion, Public
    Relations, Merchandising.
  • Place Customer Service, Physical Distribution,
    Channel Management.

The Product I-Pod (2001)
  • Simple to use excellent interface
  • Stylish design that purveys the simplicity of
  • Neutral colour scheme, but noticeable!
  • Expensive price point
  • Cutting edge technology
  • Based on established lifestyle brand from I-Mac

Is it enough just to have an excellent product?
  • So the I-Pod has excellent design, quality,
    enhanced and new technology, and excellent
    interface and its an innovation.
  • But is this enough to make a product sell as
    successfully as it has?
  • No! You have to get it noticed. Enter promotional
    strategy as one of the four Ps

Integrated marketing communications!
  • A concept of marketing communications planning
    that recognises the added value of a
    comprehensive plan that evaluates the strategic
    roles of a variety of communication disciplines
    e.g.. General advertising, sales promotion and PR
    and combines them to provide clarity, consistency
    and maximum communications impact.. The strongest
    worldwide brands use this method.

How have Apple done it?
  • Advertising
  • Packaging
  • Personal selling
  • Sponsorship
  • Public Relations
  • Exhibitions
  • Sales promotion

Very effective!
  • Targeting multiple markets simultaneously..

The Apple Brand..
  • Apple logo has become synonymous with quality by
    design, innovative use of technology, and
    aesthetic beauty inspired by a highly successful
    range of technology products since 1997 that have
    led the shift in technology being easy to use,
    efficient and not an black box hidden in the
    corner of a home, but a lifestyle object.
  • The companies internal design strategy is led by
    the use of state of the art technology
    converted for simple use, Steve jobs explanation
    of apples customs being people who dont want to
    read instruction manuals, people who lead very
    busy lives
  • The brand has been build on design led products,
    in touch with customers needs.

Product Diversification..
Consumer is temped to give their I-Pod unique
features etc. You have brought into the Brand!
PRICE strategy!
  • The initial price strategy was set as a new,
    innovative, high tech product of exceptional
    quality. So you paid for it!
  • This gives the product a desirable reputation,
    expensive, well made.
  • Product Diversification as the technology becomes
    accepted is great, the product still maintains
    the quality aspect, but becomes affordable and is
    still with the associated as a status symbol or
    lifestyle I have an i-pod, its the best, and
    I had the money for it!
  • Accessories add to continuous sales by providing
    a staple income from existing users whom have
    brought into the brand and the product Mass
  • By monitoring prices and correctly pitching the
    cost to consumers, a company can elongate the
    life of a product. Rejuvenating sales as they
    fall with add-ons etc.
  • This is particularly relevant in high tech
    markets where product lives are short! Remember
    product life cycle!

Competing products..
  • Product integration is a double-edged sword for
    the audio player market, on the one hand
    non-audio electronic goods such as mobile phones,
    PDAs, video games and digital cameras are
    increasingly being developed to include digital
    audio capabilities, so reducing the need for a
    standalone player.

So what happened?
  • The new I-Phone, fully integrated mobile
    communication device with all the excellent
    features of a simple PDA, the original MP3 player
    itself and one of the most powerful associations,
    a recognised and popular interface. It even
    browses full web pages. It has an integrated
    camera, the list is endless

  • Quite simply, you can now see how the four Ps in
    Market Strategy contribute to making a product
    successful on the market, how the evidence from
    how a product progresses on a market is integral
    to how design reacts to consumer needs at a
    strategic level.

The new project..
  • For this project we are going to examine more
    closely the bigger picture for designers and the
    commercial world..
  • We are going to examine the prospective
    possibilities in the next decade and think about
    the future for the design industry.
  • What issues will effect customers and commerce
    that is going to affect the way we work as
    designers? What will be the shape of the UK
    design industry in 2020?
  • Design is top of the agenda for the UK economy at
    the moment and you need to understand why!

What are your ideas?
  • For me this will be about Sustainability and
    Social Responsibility.
  • Poverty, HIV/AIDS has created more than 14
    million orphans 92 percent of them live in
  • China/India economic growth financially and in
    the development of knowledge economy to support
    rapid industrial and technological development.
  • Role of the government supporting creative
  • Globalisation The creation of a world
    community? Products from around the world on
    every doorstep!
  • Key Environmental problems and solving them
  • Energy Technology.. Can we solve the carbon
  • Urbanisation
  • Inclusive Design
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