MARKETING MIX
WHAT IS MARKETING MIX ?
"Putting the right product or a combination in the right place, at the right time, and at the right price."
• Methods or actions used by business organization to promote their products to market.
• A planned mix of the controllable elements of a product's marketing plan commonly termed as 4Ps.
• Traditional Marketing Mix (4Ps of Marketing)
– Product
– Price
– Place
– Promotion
PRODUCT
• A product is an item that is built or produced to satisfy the needs of a certain group of people.
• The product can be intangible or tangible as it can be in the form of services or goods.
• Anything takes the attention of the customers to fulfill their needs.
• Product Classification
– A physical object (car, phone)
– A service (salon, medical care, insurance)
– A place (hotel)
– A personality (singing star, presidential candidate)
• The Product mix is the total variety of products a firm sells.
• Some firms will sell just one product, whilst others will sell a large number of different products.
• Ex: – Samsung's product mix includes:
• Mobile phones, netbooks, tablets, televisions, fridges, microwaves, printers and memory cards.
PRODUCT ADOPTION CURVE
ROGERS' THEORY
• Innovator
Innovators are the first to purchase a product and make up 2.5% of all purchases of the product. Innovators purchase the product at the beginning of the life cycle. They are not afraid of trying new products that suit their lifestyle and will also pay a premium for that benefit
• Early Adopters
Early Adopters make up 13.5% of purchases. This group of purchasers adopt early but unlike innovators adoption is after careful thought. Early Adopters are usually opinion leaders in their circle (of friends, family and colleagues) so adoption by this group is crucial for the success of the product.
• Early Majority
The Early Majority are a cautious group of purchasers, making up 34% of purchases. They will not buy a product until it has become "socially acceptable".Early majority purchases are needed for the product to achieve wide spread acceptance.
• Late Majority
Late Majority make up another 34% of sales and usually purchase the product during the late stages of the product's life cycle. They are more cautious than the early majority and will only buy after the majority of people have purchased the product.
• Laggards
Laggards make up 16% of total sales and purchase the product near the end of its life. Some laggards will never purchase a product, whilst others will buy it because their existing product is broken and it can not be repaired or replaced with an identical product.
PRODUCT LIFE CYCLE & BCG MATRIX
PRODUCT BUNDLING TECHNIQUES
1. Pure bundling.Where you offer a group of products that are only available as a bundle and aren't sold separately.
2. Mixed bundling. Where you offer products that are sold both as bundles and as individual units.
3. Cross industry bundling.Where you offer products from more than one company that complement each other. Product bundling may also incorporate products from multiple producers.
4. Premium bundling. Pursue strategies in which the bundled price is actually higher than the total of the included products.
5. New- or lesser-product bundle. If you bundle a successful product with a newer or less successful product; the stronger product will help the other product find its way into a new market.
PRODUCT BRANDING
• What is a 'Brand‘??
• A brand is a distinguishing symbol, mark,logo, name, word, sentence or a combination of these items that companies use to distinguish their product from others in the market. Legal protection given to a brand name is called a trademark.
• Successful branding also creates “brand equity”
– the amount of money that customers are willing to pay just because it’s your brand. In addition to generating revenue, brand equity makes your company itself more valuable over the long term.
Characteristics of good brand :
1. Different : They hold a clear and defendable point of difference in the market.
2. Authentic : Are relatable and authentic in their relationships.
3. Attractive: They are aspirational and draw others towards them.
4. Dependable: They deliver their promise time after time.
5. Clear: They are simple, clear and deliver a well defined message.
6. Loved: They are loved by their own people and those that seek to interact with them.
7. Worthy: They have worth. Good brands build value back into the organisation.
8. Accountable: They can be held accountable. They can be measured to demonstrate and improve performance.
PRICE
• Values assigned for a product or service.
• It is also a very important component of a marketing plan as it determines your firm’s profit and survival.
• Adjusting the price of the product has a big impact on the entire marketing strategy as well as greatly affecting the sales and demand of the product.
PRICING STRATEGIES
• There are varieties of pricing strategies a business can use to set its price. The use of each pricing strategies can be utilized depending on each company’s marketing goal.
1. Psychological pricing
2. Multiple Unit Pricing
3. Market penetration pricing
4. Market skimming pricing
5. Bundle pricing
6. Differential strategy
7. Loss leader strategy
8. Competitor based pricing
PLACEMENT
• You have to position and distribute the product in a place that is accessible to potential buyers.
• Distribute the product or service to be available at convenient and most suitable outlet to purchase by customers (right place at right time)
• A number of alternate 'channels' of distribution may be available:
– Selling direct, such as via mail order, Internet and telephone sales – Agent, who typically sells direct on behalf of the producer
– Distributor (also called wholesaler), who sells to retailers
– Retailer (also called dealer or reseller ), who sells to end customers
– Mail order
– Internet
– Peer to Peer
– Multi Channel
PLACE AND DISTRIBUTION STRATEGIES
1. Intensive Strategy
• Try to sell their products in as many outlets as possible.
• Intensive distribution strategies are often used for convenience offerings products customers purchase on the spot without much shopping around.
• Ex: – Soft drinks and newspapers. You see them sold in all kinds of different places.
2. Selective Strategy
• Selective distribution involves a producer using a limited number of outlets in a geographical area to sell products.
• An advantage of this approach is that the producer can choose the most appropriate or best-performing outlets and focus effort on them.
• Ex: Hardware, sports items, cloths
3. Exclusive Strategy
• Involves limiting distribution to a single outlet or place product in very few outlets.
• The product is usually highly priced, and requires the intermediary to place much detail in its sale.
• Ex: Sale of vehicles through exclusive dealers.
PROMOTION
• Communicating or create awareness about the product or service to the customers.
• Promotion represents the various aspects of marketing communication, that is, the communication of information about the product with the goal of generating a positive customer response.
• Marketing communications include:
– Promotional strategy (push, pull, etc.)
– Advertising (media, printed media, social media)
– Personal selling & sales force
– Sales promotions (Special offers)
– Public relations & publicity
– Endorsements
– Campaigns
– Billboards
– Posters
SUMMARY OF MARKETING MIX DECISIONS
PRODUCT MIX EXTENSION -
7P’S The 7Ps is generally used in the service industries.
• People – Target market and people directly related to the business. Essential factor that provides the service. – Should be well trained, skilful, enthusiastic and has correct attitude.
• Process – The systems and processes of the organization affect the execution of the service. – The methods use in delivering the service and support.
• Physical Evidence – The consumers judgment regarding the service based on the physical evidence.. – This refers to the way your product, service, and everything about your company, appears from the outside.
7P’S
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