Marketing 101 Overview

Podcast

Play an AI-generated podcast conversation about this lesson

Questions and Answers

What does marketing primarily involve?

Manufacturing goods

Customer service management

Creating websites

Advertising, selling, and delivering products (correct)

How does marketing contribute to the economy?

By generating employment and accelerating business growth

Marketing has no impact on consumer awareness.

False

What is the extended marketing mix?

Product, Place, Price, Promotion, People, Processes, Physical Evidence Signup and view all the answers

The _____ determines how much the customer pays for the product.

Price Signup and view all the answers

Which of the following is NOT a part of the extended marketing mix?

Profit Signup and view all the answers

What is the role of 'People' in the marketing mix?

The individuals involved in delivering the product or service Signup and view all the answers

What is the most important factor affecting the price of a product?

Cost of the product Signup and view all the answers

The law of demand states that the lower the price, the higher the __________.

demand Signup and view all the answers

Which of the following factors affects price determination? (Select all that apply)

Cost of the product Signup and view all the answers

What pricing strategy is used when a product is positioned to be luxurious and elegant?

Prestige pricing Signup and view all the answers

Market skimming pricing is used when demand is low and supply is high.

False Signup and view all the answers

Give an example of a resort that uses prestige pricing.

El Nido Resorts Signup and view all the answers

Market penetration pricing involves setting a low initial selling price to quickly penetrate the __________.

market Signup and view all the answers

Which of the following pricing strategies is employed to attract buyers through reduced rates for bundles? (Select all that apply)

Product bundling pricing Signup and view all the answers

What is a common example of volume discounts in the hotel industry?

Booking 10 rooms to earn one free room Signup and view all the answers

Discounts based on time of purchase can only be given during peak seasons.

False Signup and view all the answers

Study Notes

Marketing 101

Marketing involves promoting the purchase of a product or service.
Marketing disciplines involve actions to attract customers and build relationships with them.

The Importance of Marketing

Marketing helps businesses understand changing customer preferences.
Marketing contributes to improved products and services.
Marketing supports economic development through employment generation.
Marketing helps a business succeed through increased sales and revenue.
Effective marketing enables businesses to compete.
Marketing helps build a company's reputation.
Marketing promotes product awareness.
Marketing creates a win-win situation for both customers and businesses.
Marketing managers identify customer needs and cater to them.
Marketing allows customers to compare competitors' products before purchase.
Promotion activities provide customers with extra benefits.
Customer Relationship Marketing (CRM) benefits customers by prioritizing existing customers.

Extended Marketing Mix (7Ps)

Product: the good or service a customer buys. It should be functional and meet customers' needs and expectations.
Place: refers to how products are distributed to customers. This may be physical (like a store) or online.
Price: should represent good value for money, which does not necessarily mean being the cheapest option but offering a fair trade-off for quality.
Promotion: includes various communication tools like advertising, public relations, sales promotion, personal selling, and social media, used to communicate with target audiences in a compelling way.
People: refers to the employees who run the business, from salespeople to management. Having the right people is essential for success.
Processes: refers to systems and processes involved in delivering a product or service to a customer. This is especially important for service-based businesses.
Physical Evidence: includes any tangible element associated with a service. Even services primarily intangible (like hairdressing) have physical aspects, like the salon itself.

Factors Affecting Price Determination

Cost of the Product: The product's manufacturing, distribution, selling, and promotion costs determine the base price.
Demand for the Product: The utility and demand for the product in the market determine the price ceiling. The lower the price, the higher the demand, following the law of demand
Price of Competitors: To understand pricing strategies, businesses analyze competitors' prices, features, distribution channels, promotions, and other factors.
Government Regulation: The government may regulate product pricing to protect consumers from unfair practices. This includes setting prices for essential goods.

Pricing Strategies

Prestige Pricing: Targets luxury and high-end markets by setting high prices to project exclusivity and attract a specific clientele. Example: El Nido Resorts implement prestige pricing, charging high rates for villas.
Market Skimming Pricing: Used when demand is high and supply is low, benefiting from price-insensitive consumers. This strategy maximizes profit margins in the short term. Example: Philippines' diving industry started with high prices due to limited dive resorts and schools.
Market Penetration Pricing: Aims to quickly penetrate the market by offering a low initial price to attract a larger customer base. Example: Paradise Island & Beach Resort in Samal Island offers relatively lower rates compared to Pearl Farm Resort to attract a broader market.
Product Bundling Pricing: Offers a discount on a package of services compared to buying them individually, enticing buyers. Example: Club Punta Fuego offers summer promotions bundling various activities at a lower price.
Volume Discounts: Incentivizes bulk purchases by offering discounts to frequent or high-volume customers. Example: Hotels provide discounts for large bookings, like 10 rooms for 1 free room.
Discounts Based on Time of Purchase: Accounts for seasonality by offering price reductions during off-season or for purchases made ahead of time. Example: Cebu Pacific uses ‘piso fare’ seat sales to attract passengers during low-demand periods.

Studying That Suits You

Use AI to generate personalized quizzes and flashcards to suit your learning preferences.

Description

This quiz covers the fundamental concepts of Marketing 101. It explores the importance of marketing in understanding customer preferences and enhancing products and services. Additionally, it discusses the role of marketing in driving economic development and building customer relationships.