Articles, essays, and talks of Rey Lugtu

(Interview with Prof. Rey Lugtu by JOSEPHINE B. VALLE Researcher, BusinessWorld, for the Best Practices Forum series, published in BusinessWorld, June 27, 2007) After designing a product or service around a specific target market, a company will have to communicate its message to its audience. For this, it has an array of media to choose from. On one end, there is the traditional television (TV), print and radio, and on the other are the more non-traditional or alternative means. Perhaps the most utilized alternative media is the Internet through tools such as E-mail, online advertisements, Web sites and Web buttons, among others. Value-for-money real estate developer Phinma Property Holdings Corp., for example, maintains a Web site that showcases its projects with features such as virtual tours to further educate its prospective buyers of its offerings. It also maintains a mailing list through which it Emails details of projects to prospective buyers. Although TV and print still compr

(Interview with Prof. Rey Lugtu by Ernesto Calucag, Senior Researcher, BusinessWorld, for the Best Practices Forum series, published in BusinessWorld, June 27, 2007) Many entrepreneurs think that selling to the widest possible market is the likeliest path to success. But given the cutthroat competition that prevails in today’s business environment, the “take all comers” approach has not been very effective, most especially for small businesses competing headon with the bigger players. Thus, one exceptional business strategy has emerged, and that is for small businesses establishing themselves in a niche market. Because no matter how hard they try, no large company can be all things to all people. There will always be segments of the population whose needs for particular products and services are going to be unmet — leaving room for small businesses to succeed by meeting those needs. A niche, in marketing terminology, is a small market consisting of an individual customer or a small gro

(Interview with Prof. Rey Lugtu by JOSEPHINE B. VALLE Researcher, BusinessWorld, for the Best Practices Forum series, published in BusinessWorld, June 27, 2007) Of the many market segments in the Philippines, the overseas Filipino workers (OFW) segment seems to have the x-factor, attracting companies from different sorts of industries be it banking, real estate or cars. Real estate developer Phinma Property Holdings Corp. known for its “best-value-for-money” homes, for one, acknowledges the growing allure of this market segment. “Because of the affordability of our units and the locations, we’ve really been catering to local end-users where the market is still strong in that segment. But, we cannot discount the fact that the OFW market is really growing,” said Phinma Properties assistant vice-president for marketing and design Grant Orbeta. Mr. Orbeta recalls the OFW market started getting attention around 2001. Since then, it has been expanding and companies pursuing this segment have

(Interview with Prof. Rey Lugtu by Ernesto Calucag, Senior Researcher, BusinessWorld, for the Best Practices Forum series, published in BusinessWorld, June 27, 2007) As mass markets continue to fragment into millions of niche markets by the minute, business owners and marketing professionals alike are in a hurry to find the right combination, whether traditional or new media tools, to lure their choice of niche market. But even with newer marketing tactics, experts believe traditional marketing media, or the use of television, radio or print media, still remains an effective marketing tool when it comes to communicating with your target niche consumers. Marketing Professor Reynaldo Lugtu, Jr. from De La Salle University Professional Schools said that traditional media’s effectiveness is very evident in the way bigger companies advertise their new products in the market, particularly those who want to conquer new business segments as their way of widening the revenue base. “Television,

(Interview with Prof. Rey Lugtu by BusinessWorld, for the Best Practices Forum series, published in BusinessWorld, June 27, 2007) BW: What is niche marketing all about? Prof. Rey Lugtu: A niche, in marketing terminology, is a small market consisting of an individual customer or a small group of customers with similar characteristics or needs. Niche marketing is, therefore, targeting this small market that is not being readily served by the mainstream product or service. A niche market is characterized by the following: -It should be profitable to serve that market -It should have enough number of buyers to make your business sustainable -The market should be growing or has growth potential so that you can continue meeting the demand for a long time. The above characteristics may be termed niche characteristics. They could however, just as well apply to a market segment. However, market segments, in contrast, are large identifiable groups within a market, such as the rich segment, the

(Published in The Manila Standard Today under the Greenlight column, June 26, 2007) Business process outsourcing is a sector that has undoubtedly witnessed spectacular growth over the last few years, providing employment to more than 200,000 BPO professionals. It is projected to grow on the average 38 percent until 2010, contributing more than $12 billion in revenue. The main drivers in this growth are BPOs in areas of contact center, back office services such as HR and payroll services, and transcription services such as medical transcription, These “lower value” BPO services all account for more than 87 percent of the total information technology enabled-services (ITES) revenues. Though industry experts project a double digit growth for these groups of BPO services until 2010, what’s worrying is that the growth is slowing down, and even plateauing in five years according to many industry practitioners. This is due to the maturing market, especially in the contact center area, and the