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This Is a Need
Needs - state of felt deprivation including physical, social, and individual needs.
This Is a Want
Wants - form that a human need takes, as shaped by culture and individual personality.
Some combination of products, services, information, or experiences offered to a market to satisfy a need or want.
This Is Demand
Wants Buying Power
Demand
What is a Market? Markets,virtual and meta markets The set of actual and
potential buyers of a product.
These people share a need or want that can be satisfied through exchange relationships.
Marketing Functions
Environmental analysis and marketing research:
Monitoring and adapting to external factors that affect success or failure, such as the economy and competition; and collecting data to resolve specific marketing issues.
Consumer analysis:
Examining and evaluating consumer characteristics, needs and purchase processes; and selecting the group(s) of consumers at which to aim marketing efforts.
Distribution planning:
Forming logistical relationships with intermediaries, physical distribution, inventory management, warehousing, transportation, allocating goods and services, wholesaling, and retailing.
Promotion planning:
Communicating with customers, the general public, and others through some type of advertising, public relations, personal selling, and/or sales promotion.
Customer Service
Marketing Performers
Manufacturer or Service Provider Final Consumer Organizational Consumer
Marketing Performers
Include: Consumers Manufacturers Service Providers Wholesalers Retailers Marketing Specialists
Marketing nearsightedness managements failure to recognize the scope of its business. Endangers future growth because the company is focusing on a product rather than customer Companys are usually to narrowly defined.
Broadly define company goals toward customer needs. MCI: We are a telephone company. or We are a communications company. Northwest Airlines: We are in the airline business. or We are in the transportation business.
Place
Promotion
The marketing mix principles are controllable variables which have to be carefully managed and must meet the needs of the defined target group. All elements of the mix are Linked and must support each other.
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Branding
Quality
Features
Benefits offered
We must remember that Marketing is fundamentally about providing the correct bundle of benefits to the end user, hence the saying Marketing is not about providing products or services it is essentially about providing changing benefits to the changing needs and demands of the customer (P.Tailor 7/00)
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Pricing Strategies
Pricing is the only mix which generates a turnover for the organisation. The remaining 3ps are the variable cost for the organisation. It costs to produce and design a product, it costs to distribute a product and costs to promote it. Price must support these elements of the mix. Pricing is difficult and must reflect supply and demand relationship.
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Promotional Mix
A successful product or service means nothing unless the benefit of such a service can be communicated clearly to the target market. An organisations promotional mix can consist of:
Direct Mail
Internet/ E-commerce
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Retailer
Consumer Consumer
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Product anatomy
Product definition
A product is a physical good, service, idea, person or place that is capable of offering tangible and intangible attributes that individuals or organisations regard as so necessary, worthwhile, or satisfying that they are prepared to exchange money, patronage or some other unit of value in order to acquire it.
WHAT IS A PRODUCT?
People buy want satisfaction, not objects. Example: Consumers buy televisions because they want entertainment, not because they want a box with a screen. Product Bundle of physical, service, and symbolic attributes designed to satisfy a customers wants and needs.
Figure 7.1
Product layers
The outer two depend on the core product to determine how they are realised.
Durable products - last for many uses and over a long period before having to be replaced. Non-durable products - can be used once or a few times before having to be replaced. Service products - intangible products comprising activities, benefits or satisfactions that are not embodied in physical products, e.g. financial services, holidays, etc.
Convenience goods - relatively inexpensive, frequent purchases which respond to routine response buying situations. Shopping goods - represent more of a risk and an adventure to consumers.
Capital goods - buildings and fixed equipment that contribute to production. Accessory goods - items that give peripheral support to the production process. Raw materials. Semi-finished goods. Components and parts. Supplies and services.
The sum of all the products and variants offered by an organisation. The product mix can be split into the following: Product lines. Product items. Product line length. Product line depth.
Marketing mix Blending of the four strategy elements product, place promotion, and priceto fit the needs and preferences of a specific target market. Marketers develop strategies to sell both tangible goods and intangible services.
DESIRE TO GROW
Growth potential limited if company focuses on a single product. Example: L. L. Bean began selling a single style of boots but has grown by selling a variety of products.
Pricing:
Low penetration pricing High skim pricing
Most common stage in the cycle. Sales begin to level off. The competition gets tougher as more competitors have entered the market.
Industry profits are largest, but it is also when industry profits begin to decline. Promotion is targeted to create brand differentiation.
New products replace the old. Firms will often try to use extension strategies. Companies may be able to keep some sales by appealing to their most loyal customers.
Pros
The product life cycle is a useful model when deciding possible stages of a product or service. Useful to help demonstrate how marketing strategies can vary at different stages of a product's life. Promotion
Cons
Tends to be backward looking We only know which stage we have been in after it has been completed.
Only looks at a single product when most firms have many products.