A marketing strategy is a business's general scheme for developing a customer base for the product or service the business

provides.

After developing a marketing strategy, there is a “Seven P Formula” that can be used to continually evaluate and re-
evaluate the business activities.

THE MARKETING MIX (7 Ps)

1. PRODUCT
 A product is the tangible good or the intangible service that the enterprise offers to its customers in order to satisfy
their needs and to produce their expected results. Products are often identified with their brand names to
distinguish them from other products in the market.
 To begin with, develop the habit of looking at the product as an outside marketing consultant brought it to help
the company decide whether or not it’s in the right business at this time. Ask critical questions like “Is the current
product or service, or mix of products and services, appropriate and suitable for the market and for the customers
today?”

General Types of Products

1. Breakthrough products - Offer completely new performance benefits

2. Differentiated products - Try to claim a new space in the mind of the customer different from the spaces occupied by
existing product
3. Copycat products - Copycat products look very similar to the brand leader. In fact, their success relies wholly on our
familiarity with the original. ‘living dangerously’ with intellectual property’
4. Niche products - Are products with lower reach, lower visibility, lower prices, and lower top of mind

2. PRICE
 The second P in the formula is Price. Develop the habit of continually examining and re-examining the prices of the
products and services to sell for making sure they’re still appropriate to the realities of the current market.
 Simplistically, price is the value measured in money term in the part of the transaction between two parties where
the buyer has to give something up (the price) to gain something offered by the other party or the seller.

Different Pricing Strategies

1. Profit maximization - A process that companies undergo to determine the best output and price levels in order to
maximize its return. The company will usually adjust influential factors such as production costs, sale prices, and output
levels as a way of reaching its profit goal. Profit is the amount of value that remains after you subtract the expenses
your business incurs during the year from the amount of revenue it produces.
2. Revenue maximization - Revenue is essentially another word for sales, or how much of the good or service that your
business produces is sold to consumers. Revenue does not take into consideration the costs necessary to produce or
market your business’s product, so it does not reflect what the owners ultimately receive. A revenue maximization
strategy dictates that a business should do whatever is required to sell as much of its product at as high a price as
possible.
3. Market share maximization- Market share represents the percentage of an industry, or a market's total sales that is
earned by a particular company over a specified time period. Market share is calculated by taking the company's sales
over the period and dividing it by the total sales of the industry over the same period. This metric is used to give a
general idea of the size of a company in relation to its market and its competitors.

Understanding Market Share

A company's market share is its portion of total sales in relation to the market or industry in which it operates. To
calculate a company's market share, first determine a period you want to examine. It can be a fiscal quarter, year or
multiple years.
Next, calculate the company's total sales over that period. Then, find out the total sales of the company's industry.
Finally, divide the company's total revenues by its industry's total sales.
 For example, if a company sold $100 million in tractors last year domestically, and the total amount of tractors sold in
the U.S. was $200 million, the company's U.S. market share for tractors would be 50%.

4. Attainment of the desired prestige or quality leadership

5. Penetration, survival, or liquidation - Penetration pricing includes presenting a low price for a new product or service
during its initial offering. The lower price helps to lure customers away from competitors. This marketing strategy relies
on the idea of low prices making a customer aware of a new product.
6. Scarcity pricing or market skimming - Skimming is the opposite pricing strategy to penetration pricing. With penetration
pricing, companies advertise new products at low prices, with modest or nonexistent margins. Using skimming, they
market products at high prices with relatively high margins. This strategy works well for innovative or luxury products
where early adopters have low price sensitivity and are willing to pay higher prices. Effectively, producers are skimming
the market to maximize profits. Over time, prices will reduce to levels comparable to market prices in order to capture
the rest of the market.
7. Cost recovery - defined as the method to recovering an expenditure which a business takes on, is both a specific and
general term.
8. Subsidy pricing - A subsidy is a benefit given to an individual, business, or institution, usually by the government. It is
usually in the form of a cash payment or a tax reduction. The subsidy is typically given to remove some type of burden,
and it is often considered to be in the overall interest of the public, given to promote a social good or an economic
policy.
9. Marginal pricing - is when a business sells a product at a price that covers its manufacturing costs but not its overhead

Profit, Revenue, and Market Share Maximization

3. PLACE – The last element of the marketing mix is the place. Also called placement or distribution, this is the process
and methods used to bring the product or service to the consumer.

• In the marketing mix, the process of moving products from the producer to the intended user is called place.
• This movement could be through a combination of intermediaries such as distributors, wholesalers and retailers. In
addition, a newer method is the internet which itself is a marketplace now.
• Through the use of the right place, a company can increase sales and maintain these over a longer period of time. In
turn, this would mean a greater share of the market and increased revenues and profits.
• Correct placement is a vital activity that is focused on reaching the right target audience at the right time. It focuses on
where the business is located, where the target market is placed, how best to connect these two, how to store goods
and how to eventually transport them

DISTRIBUTION CHANNEL

What is a Distribution Channel?

A distribution channel can be defined as the activities and processes required to move a product from the producer to
the consumer. Also included in the channel are the intermediaries that are involved in this movement in any capacity.
These intermediaries are third party companies that act as wholesalers, transporters, retailers and provide warehouse
facilities.

TYPES OF DISTRIBUTION CHANNELS

 1. DIRECT
In this channel, the manufacturer directly provides the product to the consumer. In this instance, the business
may own all elements of its distribution channel or sell through a specific retail location. Internet sales and one on one
meetings are also ways to sell directly to the consumer. One benefit of this method is that the company has complete
control over the product, its image at all stages and the user experience.
2. INDIRECT
In this channel, a company will use an intermediary to sell a product to the consumer. The company may sell
to a wholesaler who further distributes to retail outlets.
3. DUAL DISTRIBUTION
A company may use a combination of direct and indirect selling. The product may be sold directly to a
consumer, while in other cases it may be sold through intermediaries.
4. REVERSE CHANNELS
The last, most non tradition channel allows for the consumer to send a product to the producer. This reverse
flow is what distinguishes this method from the others. An example of this is when a consumer recycles and makes
money from this activity.

DISTRIBUTION CHANNEL INTERMEDIARIES

Distribution channel intermediaries are middlemen who play a crucial role in the distribution process. These middlemen
facilitate the distribution process through their experience and expertise. There are four main types of intermediaries:

1. Agents

The agent is an independent entity who acts as an extension of the producer by representing them to the user. An agent never
actually gains ownership of the product and usually makes money from commissions and fees paid for their services.

2. Wholesalers

Wholesalers are also independent entities. But they actually purchase goods from a producer in bulk and store them in
warehouses. These goods are then resold in smaller amounts at a profit. Wholesalers seldom sell directly to an end user. Their
customers are usually another intermediary such as a retailer.

3. Distributors

Similar to wholesalers, distributors differ in one regard. A wholesaler may carry a variety of competition brands and product
types. A distributor however, will only carry products from a single brand or company. A distributor may have a close
relationship with the producer.

4. Retailers

Wholesalers and distributors will sell the products that they have acquired to the retailer at a profit. Retailers will then stock the
goods and sell them to the ultimate end user at a profit.

INITIAL LOCATION SCREENING

• The number of customers residing or working in the area, and the number of customers who frequently pass through
the area

• The density or number of customers per unit area

• The access routes to alternative locations and their traffic count in those routes

• The buying habits of customers or where they buy, at what time and how frequent

• Locational features such as parking spaces, foot access, creature comforts and the like

FACTORS TO CONSIDER THAT COMES WITH THE LOCATION

• Cost of buying, renting, renovating and operating the location

 • Customer volume, drop-in (percentage of customer traffic that stop by the store) and sales conversion ratios
(percentage of drop-ins that actually purchase from the store)

FACTORS TO CONSIDER IN FINAL CHOICE OF LOCATION

• Image and location conditions. Refers to the physical look of location.

• Exact fit to target costumer. If the location generally composed your target costumer.
• Clustering of competitor establishments. Drawing a bigger market in the location
• Future area development. It might not have the most customers in the short term but might become a central hub
within the next few years.
• Fiscal and regulatory requirements
RELEVANT LOCATION DRIVERS
• Physical proximity to target market
• Customer traffic flow
• Industry clustering
• Convergence of Multiple industries
• Population concentrations
• Activity hubs
• Growth potential
• Business Climate
• Cost of Doing business and producing goods and services
LOCATIONS WITH A GOOD BUSINESS CLIMATE
• High economic growth
• Stable political condition
• Effective social services
• Good infrastructures
• Cheap utilities
• Efficient transportation and logistics
• Availability of skilled labor force
• Low crime rates
• Trusted public officials
SECOND QUARTER

4. PROMOTION

Promotion - Communication strategy adopted by an enterprise to elicit the patronage, loyalty, and support not only from its
customers but also from its other significant stakeholders.
1. Advertising
2. Public relation campaigns
3. Promotional tours
4. Product offerings
5. Point-of sale displays
6. Websites
7. Flyers
8. Emails
9. Letters
10. Telemarketing
Factors for Effective Promotion:

 The credibility of the communicator

 The message and the medium of the message
 The receptiveness of the audience to all that is being communicated
1. Advertising is a marketing tactic involving paying for space to promote a product, service, or cause. The actual
promotional messages are called advertisements, or ads for short. The goal of advertising is to reach people most likely
to be willing to pay for a company's products or services and entice them to buy.
2. Public relations (PR) is the way organizations, companies and individuals communicate with the public and media. A PR
specialist communicates with the target audience directly or indirectly through media with an aim to create and
maintain a positive image and create a strong relationship with the audience.

3. Promotional tours. The tourism industry is unlike any other because, instead of a product, you are selling a place and all
the things it has to offer. You are competing with the entire world every time you promote tourism in a given
destination, and this high level of competition demands a creative and unique approach.
4. Product offerings. An offering in marketing is the total offer to your customers. An offering is more than
the product itself and includes elements that represent additional value to your customers, such as availability,
convenient delivery, technical support or quality of service.
5. Point – of – sale displays. In a highly competitive retail environment, it is important to differentiate product from the
competitors and attract consumer. Influencing consumer behavior at the point of purchase is critical to sales success.
Point of Sale (POS) displays are designed to meet specific marketing objectives and uses both creative, structural and
graphical design to maximize brand impact and drive increased sales. They are also know as point of purchase displays,
kiosks displays.
Common items that appears near point of sales display throughout the year around are generally chips, wafers,
candies, chocolates, magazines and soft drinks
6. Websites. A website is a collection of related web pages, including multimedia content, typically identified with a
common domain name, and published on at least one web server.
7. Flyers. A flyer is a form of paper advertisement intended for wide distribution and typically posted or distributed in a
public place, handed out to individuals or sent through the mail. In the 2010s, flyers range from inexpensively
photocopied leaflets to expensive, glossy, full-color circulars.
8. Emails. Congratulations! Your just got a new email subscriber. Now it’s time to establish a relationship with them. And
what is every great relationship built on? Trust. This should be one of your main goals when crafting your promotional
emails.
9. Letters. Marketing and sales promotion letters are used to cover a wide variety of different situations when promoting
products and/or services to individual customers and/or business clients. When writing one of these, the main idea is
to summarize all of the key points of the offer, in terms of benefits, and then make a call to action that will get them to
act right away on the offer.
10. Telemarketing. Telemarketing can be an effective tool for your business and it can be an easy and effective way to
increase your profits and promote your product or service. However, it does have some disadvantages that you should
also consider.

Benefits of using Telemarketing

• The main benefit of using telemarketing to promote your business is that it allows you to immediately gauge your
customer's level of interest in your product or service. Additionally it allows you to do the following:
• provide a more interactive and personal sale service
• create an immediate rapport with your customers
• explain technical issues more clearly
• generate leads and appointments
• sell from a distance to increase your sales territory
• reach more customers than with in-person sales calls
• sell to both existing and new customers
• achieve results that are measurable

5. Packaging . “Packaging can be more important than the product itself, if done imaginatively”

Packaging does not refer only to the wrapper or container of the product, it can mean the bundle of products or
services that are put together to attract and delight costumers. It can also mean the terms and conditions attached to
the sale or after-sale servicing of the product.

PACKAGING displays the ff:

 Brand name
 Main attributes of the product
 Company’s logo
 Place of business

Packaging design
Material
Measurement

PURPOSES OF PACKAGING
 Provides easy brand identification for the consumers
 Differentiates the product from its competitors and even from its other brand offering
 Lengthens the lifespan, physically protects and extends the usefulness of the product
 Becomes an environmental issue by itself
 Increase the cost of the product

6. People

 People are the ultimate marketing strategy

 People distribute, promote, price and sell the products in the most attractive market places
 The people in the organization play a crucial role in the success of the enterprise.

Levels of Marketing efforts

 Create customer awareness

 To arouse customers’ interest
 To educate customers as they evaluate their buying choices
 The close sale and delivery of products

Organizational modalities

 Outsource the people from advertising agencies, events management outfits, call centers and telemarketers
 To build in-house capabilities by hiring market researchers, brand managers, salespeople, public relation officers,
website writers, orchestrators, etc.
 To collaborate or enter into partnerships with principals, distributors, dealers and industry associations

7. Positioning. Market positioning is about how you want your customers to perceive your product or service in relation
to their perception of your competitors and what marketing strategies you should adopt to reach this perceptual goal.
 In other words, what message about your product or service is your companies trying to put across and how will you do
that?

 When developing a market position you need to select the most persuasive, meaningful and unique points of
difference that will allow you to compete for the largest number of potential customers.
 Other companies develop marketing strategies which position them well away from their competitors. Offering a
benefit which is superior depends on the marketing mix strategy the company adopts. Your pricing strategy must
reflect the benefit offered and your promotion strategy must clearly communicate this benefit

Objectives of Positioning:

 Enterprise perspective  enterprise scans the market environment and decides the position itself with products that
specifically address the needs of a chosen target market
 Competitive Perspective  the enterprise has to differentiate and distinguish itself from it competitor.
 Customer’s Perspective  Positioning is the ay the customer perceive the enterprise and its products or services in
their minds

Product Positioning.
 Determining the critical success factors that enable other players to succeed and the factors that cause other business
to fail and how to manage it to the enterprise advantage.
 Determining the critical success factors that enable other players to succeed and the factors that cause other business
to fail and how to manage it to the enterprise advantage.
 Details such as their major buyer, attributes or features that make the competitor’s products attractive should give the
entrepreneur an idea.
 In determining the positioning the enterprise should be mindful of the Main value Proposition.
 MAIN VALUE PROPOSITION (MVP) – Main Value Proposition refers to a business or marketing statement that a
company uses to summarize why a consumer should buy a product or use a service

Main Value Proposition

This statement convinces a potential consumer that one particular product or service will add more value or better solve a
problem than other similar offerings will.

Example: