Marketing Chapter 3: Introduction to Marketing

Chapter 3: Introduction to Marketing

• Marketing is about placing the right product in the right place, at the right time, and for the right price.
• Understanding every aspect of your business plan is crucial for successful marketing.

Lesson 4: Marketing Mix - Product

• Product refers to the functions and features of a good or service.
• Key questions include: What do customers want? What additional services should be offered with the product?

Product Strategy

• Product Strategy encompasses the core benefit, brand name, quality level, features, design, packaging, and warranty of a product.
• The Augmented product includes add-ons like delivery and credit, installation and after-sale service.

Four Development Strategies

• Product Improvement: Modifying an existing product to relaunch it (e.g., a new edition of a product.)
• Market Development: Expanding into new markets with existing products (e.g., franchising products to new locations.)
• Product Development: Introducing new products to established markets (e.g., a new SUV model by a car manufacturer.)
• Product Diversification: Creating new products for new markets (e.g., a company branching into a new business.)

Lesson 5: Marketing Mix - Place

• Place focuses on making products available in the right place, at the right time, and in the right quantities.
• E-commerce (online sales) is increasingly important.
• Channels of distribution define how products reach consumers (e.g., one-level, two-level, three-level, four-level).

Intensity Levels of Distribution

• Intensive: Mass market reach with convenience goods (e.g., Coca-Cola).
• Selective: Limited intermediaries, often for shopping and specialty goods (e.g., electronics).
• Exclusive: Products sold through single intermediaries (e.g., luxury car distributors).

Lesson 5: Marketing Mix - Price

• Defining price involves understanding its significance to both the seller (revenue and profit source) and the customer (cost of acquisition).
• Demand plays a crucial role in price determination.
• Different types of demand-based pricing strategies exist.

Importance of Price-Practice

• Consumer surveys revealed that lower price and wider product selection are top factors influencing supermarket choice.

Basic Strategies of Price

• Market Skimming Pricing: High initial prices to recoup investment, reducing later.
• Market Penetration Pricing: Low initial prices to gain market share.
• Neutral Pricing/Competitive Pricing: Matching competitor prices.
• Premium Pricing: High prices for high-end products with perceived value and minimal change.
• Full-cost Pricing: Calculating price based on costs and markup.
• Psychological Pricing: Setting prices ending in .99 to appear less expensive.

Lesson 5: Marketing Mix - Promotion

• Promotion involves various methods to increase demand for goods and services.
• Different promotional methods need to be analyzed and evaluated considering their suitability to a product.

What is Promotion?

• The Promotion Mix encompasses various tools used by businesses to create, maintain, and boost demand for their offerings.

What are the Aims of Promotion?

• Aims of Promotion are not specified, but various marketing objectives might be inherent.

Advertising

• Various platforms are used for advertising (TV, radio, newspapers, magazines, direct mail, outdoor ads, directories, the internet.)

The Elements of the Promotional Mix

• The Promotional Mix incorporates advertising, personal selling, internet marketing, publicity, and sales promotion.