ShareWORLD Open University Malawi

Faculty of Business, Economics & Management Sciences

Department of Management

PROGRAMME:

BSc in Business Finance

YEAR:

COURSE NAME:
Management.

Introduction to Business

COURSE CODE:
TO:

MR. KASENDA

FROM:

Pempho Mwase

STUDENT NO:
ASSIGNMENT NO:

6
th

DUE DATE:

th

DATE SUBMITTED:

2014
2014

Statement on Plagiarism, Collusion & Academic Incompetence

The University unequivocally condemns plagiarism, which it considers to be
comparable to falsifying data and cheating in an examination, and warns
students that the Academic Board looks gravely upon incidents of plagiarism.
Such incidents are classed as Academic Misconduct which results into a
student getting a zero grade.
I, Pempho Mwase, DECLARE that this work is FREE of plagiarism otherwise I will
face consequences thereof if discovered that this work is not supported by
proper Harvard referencing and merely a cut & paste.
Signed. Date:
2014

th

For Lecturers use only Marking Guide

Descriptor
Work
Work
Work
Work
Work

of
of
of
of
of

excellent quality
very good quality
good quality
fair but below average quality
marginal quality

% Mark
Range
90 100 A+
75 89 A
65 74 B
50 64 C
40 49 D

Student
Mark

Unsatisfactory, failing work

Unjustified absence or failure to hand in assigned
work in time

0 39 E
0
R

Question: Explain marketing mix and its relation to product life cycle.

Marketing is the process of planning and executing the conception, pricing, promotion, and
distribution of ideas, goods, services to create exchanges that satisfy individual and
organizational goals. (Kotler, Keller, 05), or Marketing can be described as an organizational
function and a set of processes for creating, communicating, and delivering value to
customers and for managing customer relationships in ways that benefit the organization and
its stakeholders. This essay will explain marketing mix and the 7 ps of the eleven which
include the four basic namely; price, product, promotion, and place. Then later on define how
each stage of a products life cycle is related to marketing mix.
Marketing involves a number of activities. To begin with, an organisation may decide on its
target group of customers to be served. Once the target group is decided, the product is to be
placed in the market by providing the appropriate product, price, distribution and promotional
efforts. These are to be combined or mixed in an appropriate proportion so as to achieve the
marketing goal. Such mix of product, price, distribution and promotional efforts is known as
Marketing Mix (Hill S. 2009).
According to Grodin S. (2002) Marketing Mix is the set of controllable variables that the
firm can use to influence the buyer s response. Each firm strives to build up such a
composition of 4P s, which can create highest level of consumer satisfaction and at the same
time meet its organisational objectives. Thus, this mix is assembled keeping in mind the
needs of target customers, and it varies from one organisation to another depending upon its
available resources and marketing objectives. Let us now have a brief idea about the
components of marketing mix.
Price is the amount charged for a product or service. It is the second most important element
in the marketing mix. Fixing the price of the product is a tricky job. Many factors like
demand for a product, cost involved, consumer s ability to pay , prices charged by
competitors for similar products, government restrictions etc. have to be kept in mind while
fixing the price. In fact, pricing is a very crucial decision area as it has its effect on demand
for the product and also on the profitability of the firm (Palmer A 2003).
The goods and service combination the firm offers to the target market, including variety of
product mix, features, designs, packaging, sizes, services, warrantees and return policies. A
product is anything that can be offered to a market for attention, acquisition, use or
consumption that might satisfy a want or need (Hill S. 2009), but as mentioned above a
product can also be a service, a service is any activity or benefit that one party can offer to
another that is essentially intangible and does not result in the ownership of anything. product
can have both tangible and intangible aspects, and is the thing you offer to satisfy your
customers wants and needs. Within this element, you need to consider such things as
your product range; its quality and design; its features and the benefits it offers; sizing and
packaging; and any add-on guarantees and customer service offerings.
If the product is manufactured keeping the consumer needs in mind, is rightly priced and
made available at outlets convenient to them but the consumer is not made aware about its
price, features, availability etc, its marketing effort may not be successful. Bennett P. (2004)
says therefore promotion is an important ingredient of marketing mix as it refers to a process

of informing, persuading and influencing a consumer to make choice of the product to be

bought. Promotion is done through means of personal selling, advertising, publicity and sales
promotion. It is done mainly with a view to provide information to prospective consumers
about the availability, characteristics and uses of a product. It arouses potential consumers
interest in the product, compare it with competitors product and make his choice. The
proliferation of print and electronic media has immensely helped the process of promotion.
Place (or placement) decisions are those associated with channels of distribution that serve as
the means for getting the product to the target customers. The distribution system performs
transactional, logistical, and facilitating functions. Distribution decisions include market
coverage, channel member selection, logistics, and levels of service (Weinstein A. 2006). So,
it is necessary that the product is available at shops in your town. This involves a chain of
individuals and institutions like distributors, wholesalers and retailers who constitute firm s
distribution network (also called a channel of distribution). The organisation has to decide
whether to sell directly to the retailer or through the distributors/wholesaler etc. It can even
plan to sell it directly to consumers.
The other three Ps include; people, process and physical evidence, and these are briefly
defined below:
The process part of the mix is about being easy to do business with. If youve ever become
frustrated at call centres that cant answer your questions, or annoyed when you cant buy
something in a shop because the computerised till doesnt recognise that it exists, even when
you can see it on the shelves, youll know how important this element can be. The more high
contact your product, and the more intangible, the more important it is to get your processes
right. Remember to look at this from your customers point of view. The process problems
that are most annoying to a customer are those that are designed for the providers
convenience, not the customer.
The impact that your people can have on your marketing cannot be underestimated. At its
most obvious, this element covers your frontline sales and customer service staff who will
have a direct impact on how your product is perceived. You need to consider the
knowledge and skills of your staff; their motivation and investment in supporting your
brand (Grodin S. 2002). Any element of the marketing mix will also have its impact on other
elements of your business, but the people element is one where the importance of regarding
marketing as an integral part of the way you do business is crystal clear.
When you sell tangible goods, you can offer your customer the chance to try before they
buy, or at least see, touch or smell. With services, unless you offer a free trial, your customer
will often be buying on trust. And to help them do so you need to provide as much evidence
of the quality you will be providing as possible. Palmer A. (2003) states that physical
evidence refers to all the tangible, visible touch points that your customer will encounter
before they buy, from your reception area and signage, to your staffs clothing and they
images you include in you corporate brochure.

Product life cycle (PLC) is the cycle through which every product goes through from
introduction to withdrawal or eventual demise.
During the development stage, the product may still be just an idea, in the process of being
manufactured or not yet for sale. In this stage, the marketing mix is in the planning phase, so
rather than implementing marketing strategies, the product producer is researching marketing
methods and planning on which efforts the company intends on using to launch the product.
The marketing mix for this stage includes ways to bring awareness of the product to potential
customers through marketing campaigns and special promotions (Hill S. 2009).
As the product hits the market, it enters the introduction stage of the product life cycle.
Because it is a new product that customers are not yet aware of, the product sales during the
introduction stage are generally low. At this time, marketing expenses are generally high
because it requires a lot of effort to bring awareness to the product. The marketing mix during
this stage of the product life cycle entails strategies to establish a market and create a demand
for the product (Hill S. 2009). According to Bennett P. (2004), at the Introduction Stage of a
product life cycle of product marketing, quality levels and branding are
established, as are intellectual property aspects such as trademarks and patents.

The nature of pricing at this instance may be either low to enable market penetration or
artificially high to facilitate the recouping of development costs. Maintaining artificially high
prices, leveraging super profitable margins can usually only be achieved during the lifecycle
stages that allow the product to maximise the benefits of patent protection. This is especially
common in the branded pharmaceuticals industry, amongst others.
As customers become aware of the product and sales increase, the product enters into the
growth stage of the product life cycle. Marketing tactics during the growth stage requires
branding that differentiates the product from other products in the market. Marketing the
product involves showing customers how this product benefits them over the products sold
by the competition, also known as building a brand preference. (Grodin S. 2002) explains that
During the Growth Stage of a product life cycle, companies will maximise their effort
expanding market share and consolidating brand preference. The quality of the product is still
maintained and extra features may be added to increase customer preference and give the
perception of added value. The same pricing structure is retained as the company enjoys the
benefits that are derived from increasing demand and largely limited competition, especially
if still patent protected. The promotional activities that the firm sets out to undertake are
generally aimed at increasing the market share by targeting wider audiences of potential
customers. Distribution channels start being developed thanks to increased product
acceptance and as a direct result of customers actively demanding the product.
As the product gains over its competition, the product enters the maturity stage of the product
life cycle. The marketing mix during this stage involves efforts to build customer loyalty,
typically accomplished with special promotions and incentives to customers who switch from
a competitor. During the Maturity Stage of the product life cycle the increasing market share
of the previous stage becomes stagnated. It is very likely that competitors will have
introduced similar new, often improved products. Most companies will at this stage try hard

to simply retain its market share while seeking to maximise profits for as long as possible.
The product may be physically improved in a bid to give it a lift over that which other
competitors are now offering. Promotional aspects will largely seek to create awareness with
respect to product differentiation and the pricing may be adjusted downwards, or at least
larger discounts offered, in response to enhanced competitive products. Attempts to increase
the channels of distribution should be maximised as suggested by Palmer A. (2003). A great
tactic at this stage is to strengthen product promotions and offer further buying incentives as a
way of winning over customers that might otherwise be, or perhaps have already been,
attracted by the competitors latest more advanced products.
Once a product market is over saturated, the product enters into the decline stage of the
product life cycle. Weinstein A. (2006) explains that this is the stage where the marketing mix
and marketing efforts decline. If the product generated loyalty from customers, the company
can retain customers during this stage, but does not attract new sales from new customers.
For the marketing mix that remains during the decline stage, the focus is generally on
reinforcing the brand image of the product to stay in a positive lane. During the products
Decline Stage of the product life cycle the company may decide to stick with the product and
make minor improvements to it or, alternatively, evolve an entirely new use for it within the
existing market. The company may now choose to harvest or milk the product by making ongoing price reductions and ensuring it retains the products most loyal customers.
Alternatively the firm may opt to de-list the product and discontinue manufacturing and
marketing that product completely. Often, this choice is made to make way for launching new
more effective products, whether related to the old product or not. In developing its product
marketing strategy, the company must first understand what range of products it intends to
offer and who the target customers for those products will be, as defined by the marketing
mix. In other words, plan the distribution channels through which the products will be
marketed as well as also understand why these customers might prefer these products as
opposed to those that other competitors are offering.
In addition, other businesses are guided by the product concept, which holds that consumers
favour those products that offer the most quality, performance, or innovative features.
Managers in these organizations focus on making superior products and improving them over
time, assuming that buyers can appraise quality and performance.

REFERENCE:

Bennett P. (2004), Dictionary of Marketing Terms, 2nd ed.

Chicago, American Marketing Association.
Grodin S. (2002), The Marketing Book, Boston, Houghton Mifflin.
Hill S. (2009), Radical Marketing, 3rd ed. New York, Harper
Business.
Palmer A. (2003), Principles of Services Marketing, London,
McGraw-Hill.
Weinstein A. (2006), Marketing, Chicago, Probus Publishing.