MARKETING REQUIREMENTS ASSESSING AND SELECTING A SUITABLE MARKET NOTES

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MARKETING REQUIREMENTS ASSESSING AND SELECTING A SUITABLE MARKET NOTES

Marketing Functions and strategies


Marketing consists of a multitude activities that include decisions
about the company’s

  • Products or services
  • Pricing policies
  • Promotions and
  • Distribution methods.

The ultimate equal is to facilitate exchange between an enterprise and
its customers. This exchange relationship exists as one party becomes
willing to give something of value in order to receive something of
value. Marketing is the process of conceiving than exchange and then
accomplishing the tasks necessary to deliver t he goods or services in a
manner that satisfies customer and meets the business objective.

3.1.1 Marketing Functions
Is the combination, designing and integrating all elements of marketing
into various functions which on the basis of an appraisal of the market
forces would achieve the objectives of an enterprise at a given time.

Marketing functions include:

The product – involves the planning, designing and developing the
right type of the product in order to meet the customer’s satisfaction.
It includes.

  1. The packing of the product
  2. The image
  3. The brand name and label
  4. The product
  5. The product quality
  6. The product range
  7. The product output
  8. The product warrantees and after sale services
  9. The product policy
  10. The product

The price– involves giving value which is charged by the suppliers.
This is an important element of marking because;

  1. It relates directly to the generation of revenue
  2. Measures the profit cost and revenue elements.
  3. Affects the product quality and quantity
  4. Has a psychological impact on consumers.
  5. The placement – also known as distribution is concerned with linking
    the seller and buyer through the product and involves elements of
  • Inform potential customers
  • To convince and persuade existing customers to continuer choosing
    the product
  • To establish a business image or good will
  • To canter competition from other business dealings
  • To increase sales and revenue.

3.1.2 The marketing strategy


This is a consciously formulated plan that describes how the new venture
will compete. It focuses the business enterprise on a target market to
fill the gap or create a nitche. A well calculated marketing strategy
provides guidelines for the entrepreneur
concerning-:

  • The expected results
  • Allocation of resources
  • Responsibilities for marketing
  • Ways of controlling the enterprise.

3.2 The marketing Plan
Solidifies the marketing strategy by defining customers, sales forecasts
and marketing objectives. It synthesizes market research and the
entrepreneurs strategy into a blueprint for action. The plan is
implemented through a marketing programme, which addresses the
marketing activities decisions regarding product, the pricing, the
promotional activities and the placement activities.

3.2 The Marketing Mix


The term marketing mix refers to the apportionment of effort,
combinations, designing and intergration of all elements of marketing
into a single programme aimed at achieving the objective of a business
enterprise. It is a detailed strategy, tasks, operations policies
programmes, techniques and activities to which resources may be
allocated to achieve marketing objectives. The term is used to describe
the combination of the four inputs which constitute a marketing system (
4pcs) i.e

  • The product
  • The price
  • The placement
  • The promotions

The 4 Ps (the four Ps)


The marketing mix denotes a combination of the various elements which in
their totality make up a marketing system i.e. the product, the price,
the placement and the promotion.

3.3.1 The Product


The product element of the marketing mix involves the planning,
designing and developing the right type of the product or service to
meet the customer satisfaction. The main decisions involve-;.

  1. The product involve
  2. The product size
  3. The product quality
  4. The product design
  5. The product range
  6. The product volume
  7. The product packaging
  8. The brand name and label.
  9. The product warranties and after sale service.

The product element of the marketing mix strives to establish.

  1. A product policy
  2. The product strategies
  3. The product mix
  4. A product Policy. The product policy is a principal of operation on
    the production process of a given product adopted by the management to
    guide those who carry out the action. A product policy sets out the
    objectives to be achieved and also the limits within which the
    management has to operate. The main functions of a product policy are to
    guide the activities of the firm towards its common goals which include.
  • Considerations of the product mix
  • Considerations of the rate nature and direction in changes in demand
  • Product elimination and new product dev.

The product policies engage in product planning development ,production
marketing , volume of production , timing e.t.c

  1. Product Mix
    A product mix lists all products offered for sale by a company which
    details three diminutions of a product – namely;
  • The product breadth
  • The product depth and
  • Consistency

The product breadth- is measured by the number of variety of products
manufactures by a single firm e.g – the Panasonic company – making TVs
fridges radios DVDs e.t.c The product consistency – refers to the close
relationship of different product line either to their end distribution
channel e.t.c e.g. the Toyota Company – produces those goods which fall
under motor vehicles – consistency is seen- unlike unilever. The product
depth- refers to the assortment of size, colour and models with each
line e.g the Toyota car.

3.3.2 The Price


Pricing the product is an important element of the marketing mix. Price
is the value or sum of money which is charged by the supplier of a
product or service from the buyer. The financial price is the
measurement of value and has the following importance.

  1. economic value- because it relates to the generation of product revenue.
  2. Profits – through price profit cost and revenue elements are measurable.
  3. Product quality – price gives indication of the product quality.
  4. The psychological element- price has a psychological influence in
    the market i.e high prices co-relate to superiority.
  5. Co-oporate goals- are achievable through pricing decisions
    especially in formulating marking strategies
  6. Meeting consumer expectations is measurable through price.

3.3.3 Placement
Also known as distribution of goods physically. This component of the
marketing mix is concerned with linking the seller and the
buyer. It involves the elements of

  • The channels of distribution
  • The transport means
  • The warehousing
  • The routing of the product.

3.3.4 Promotions
(A promotional message)

  • A product promotion is the act of providing information about a
    product to its prospective users in order to persuade them to buy ,
    enjoy or choose the product
  • Any product promotional message usually includes information which
    shows;
  • That the product exists
  • That the product has ability to satisfy a particular want
  • The physical location where the product can be obtained or enjoyed
  • The qualities that the product can be obtained or enjoyed.
  • The quantities that the product can be obtained
  • The times when the product can be obtained
  • The price of the product.
    Exam quest, briefly explain what entails a promotional message.

Factors that influence a product promotion.

  1. The nature of the market
    Where competition prevails, producers strive to make their products sale
    as opposed to less competitiveness.
  2. The nature of the consumers
    The level of information the consumers are accessible to creates
    awareness. Any gaps left are filled with product promotion
  3. The effect of modern technology.

The importance of product promotion

  1. To inform potential customers about the existence qualities and other
    important details regarding a product.
  2. To convince or persuade existing customers to continue buying the
    product and potential customers to choose it.
  3. To establish a business image or goodwill among the existing and
    prospective customers
  4. To facilitate more sales revenue.

Methods of Product Promotion
There are five main ways of promoting products namely

  1. Advertising
  2. Personal selling
  3. Sales promotion
  4. Publicity
  5. Public relations.
  6. Advertising
    Refers to drawing attention to or describing a product in a public
    medium e.g Newspapers , radio, television e.t.c Any advert in order to
    give value for its purpose should contain the following aspects.
  • a media presentation
  • payments for the advert
  • Identifiable sponsor who pays for the advert.
    Note:

Any communication without costs to the sponsor is publicity and not
advertisement.

Reasons for Advertising

  1. To introduce new products
  2. To stimulate desire for more quantities of the product
  3. To persuade the public to buy the product
  4. To explain new uses of a product
  5. To remind customers of the existing product
  6. To explain new used of a product
  7. To create recognition of a particular brand of products
  8. To maintain the products name or slogan in public
  9. To prepare way for sales persons in selling ‘
  10. To remove any bias that customers may have developed about the product.
  11. To inform customers of new prices, packaging changes or any other
    changes
  12. To supplement the efforts of salesmen
  13. To reach out for few markets.

Types of Advertising
Any advert may be classified on the basis of

  • What is emphasized
  • The nature of the message advertised
  • The geographical coverage

But the main types include.

  1. product advertising – which basically promotes the sale of a
    particular brand of a product a. no mention of the manufacturer and
    emphasis is on the product e.g Accountancy profession”
  2. Institutional advertising – tends to focus on creating a positive
    attitude on the business producing or providing the product / service
    emphasis in on the institution.
  3. Primary demand advertising – targets demand stimulation for arrange
    of products without mentioning a specific brand or manufacturer e.g
    Adidas products or GNLD products.
  4. Celebrity advertising – the advert uses a famous personality to
    enclose the use of a given product – The aim is to use these people to
    attract attention.
  5. Corrective advertisement – seeks to correct errors or misleading
    claims made in an earlier advertisement.

Advertising Media
An advertising media is the means through which an advertised message is
conveyed to the members of the public who are consumers.
The following are some of types of media available to advertisement.

  • The press e.g newspapers
  • Posters
  • Billboards
  • Brochures
  • Shopping news
  • Radio
  • Television
  • Neon signs e,t.c

Factors which determine choice of an advertising medium

  1. The intended target group
    The nature of the target group interms of habits customers age,
    e,t.c will determine choice of the right medium.
  2. the physical characteristics
    The mediums physical characteristics i.e visual aspects, colour,
    movement’s e.t.c.
  3. Media circulation
    Where an advertiser aims to reach countrywide cliental, choice of a
    nationwide media is necessary.
  4. Cost of advertising
    Should be affordable and that they should be reasonable compared to
    the returns.
  5. urgency of the advertisement
    Urgent and quick adverts may require mediums such as Radio , TV e.t.c

Advantages of advertising

  1. To the advertiser ( or business enterprise)
  2. It provides a business enterprise with opportunity to inform the
    public on what they offer.
  3. It stimulates demand for a product thereby increasing sales and the
    sellers profits.
  4. Acts as a reminder to customers of the existing products.
  5. Helps sustain brand loyalty
  6. It quickens brand recognition
  7. Enables quick access and purchasing of the product after knowledge
    of placement and quantities.
  8. To the customer
  9. It increases customers awareness of a new product
  10. Helps indicate the variety of products available in the market
    facilitating choice
  11. Leads to better quality products due to competition
  12. Leads to increased qualities being produced.

Disadvantages

  1. To the advertiser
  2. A costly method of promoting products
  3. Where offensive or erroneous may be negative
  4. One can be sued where advert is misleading.
  5. Competitive advertising may cause a seller t o be pushed out of
    business.
  6. Difficulty due to existence of several media.
  7. To the customer
  8. Advertising costs are normally borne by the consumer
  9. Misleading especially where there is consumer ignorance
  10. Encourage impulse or irrational buying
  11. Some adverts are irritating, anti-cultural and offensive.

Sales Promotion
Sales promotion refers to the strategies and incentives which are aimed
at promoting the purchase of a given product. The sales promotion
strategies are divided into two namely.

the strategies aimed at the customer directly these include

  • direct main i.e cards, postcards e.t.c
  • gifts and other premiums e,g soap, toothbrushes
  • discounts
  • displays e,g supermarket
  • credit facilities
  • Use of loss leaders – one good is sold cheap to attract customers.
  • Use of free samples
  • After sale services.

the strategies aimed at the sales force

  • commissions – money given to dealers
  • commissions – money given to dealers
  • demonstrations models
  • push money- to facilitate movement of the salesmen
  • training
  • Provision of point of sale displays.

Advantages of Sales Promotion

  1. promotion activities persuade and convince potential customers
  2. expand the market scope
  3. discounts reduce prices for consumers and credits stimulate a
    greater turn over
  4. attracts customers through use of price leaders
  5. Good will is built by after sales services and sample giving.
  6. Training and demonstrations remove fear of using a product

Disadvantages of Sales Promotion

  1. The sales promotional incentives are expensive i.e free sample
  2. Bad debts may arise from credit facilities
  3. Time and money consuming for sales services especially
  4. After sale services ties customers to one seller.

Personal Selling

This is the method of promoting

  1. availability of adequate resources for the sales force
  2. easy accessible and concentrated markets
  3. high unit value for the product
  4. products whose use needs demonstration
  5. Suitability of a product to individual need as opposed to general use.
  6. Introduction of new products in the market.

Forms of personal Selling

  1. Field sales
  2. Showroom selling
  3. Shows, trade fairs and exhibitions.

Advantages of Personal Selling

  1. presents an opportunity to show the existing and potential customers
    what is available
  2. it offers the prospective buyers an opportunity to see, examine
    taste and ask questions about a product – and chance of comparing
  3. the questions from prospective buyers are immediately answered
  4. immediate contacts are made between sellers and buyers for follow up
  5. complementary adverts from other mediums e.g advertising
  6. Seller has opportunity to obtain information about the competing
    products and promotional strategies.

Disadvantages

  1. it is an expensive promotional method – especially where a wide
    coverage and oversees exhibitions are involved.
  2. Energy and time are consumed on talks convincing and demonstrations
  3. Requires cost controls of sales persons
  4. Has limited coverage as it targets a limited group.

Publicity

Refers to the free advertising whereby the desire for a product is
created or boasted by unpaid – for features or presentation in the
mass-media ( e.g a feature in press). These features may be solicited
for or unsolicited for but remain entirely unpaid
for by the busiess. – or a news release sent to studio.

Advantages
Builds the sellers goodwill and image among existing and prospective
customers

  1. It involves no costs on the side of the seller
  2. Has a large and widespread reach since it conveyed through media.
  3. Has a high creditability as it is reported independently.

Disadvantages
Unfavourable information may be released unknowingly released to the public

  • Information released is to the discretion of the media house
  • It is irregular and short – lived hence my not be effective.

Public Relations
The term public relations (PR) when used in product promotion refers to
the process of communicating information of an organization product.
Policies and actions to specific consumer groups or the public at large.
This is done with the view of creating awareness and a positive attitude
towards the organization and the product. It could also be done to
correct mis-information or rehabilitate a spoilt image in order to get a
satisfied client. It aims at creating a favorable attitude towards the
organization in order to promote acceptance.

Strategies of Public Relations

  1. Market research i.e
    The process of gathering recording and analysis information about a
    market with the view of coming up with the best strategies of
    selling products in that particular market.
  2. Consumer research
    Where activities are concentrated on knowing more about the
    consumer. The aim is to identify which products have the highest
    value to the consumer
  3. market segmentation
    Refers to the process of subdividing the market into sections to
    scope rate various interests of various consumer groups.
  4. Product difference
  5. Branding
  6. Packaging.

Advantages

  1. Effective in presenting information about the product and policies of an organization
  2. addresses the desired target audience
  3. effective in correcting any mis-information

Disadvantages

  1. expansive and therefore requires careful planning in both time and funds
  2. Impact takes time- hence is a long term.
  3. Its impact is difficult to gauge.

Factors which may influence an entrepreneur in choosing a promotional method.

  1. cost element of each method of promotion should be analyzed in order
    to suit financial abilities
  2. Targeted audience is important in order to address an appropriate
    combination method.
  3. the nature of the product to be promoted i.e those that may require
    demonstrations and training et.c
  4. Urgency of the promotional message.
  5. Availability of resources especially the mechanical physical and
    human resources to implement a promotional mix.
  6. level of demand for the product
    a. where demand is high fewer promotional methods are required
  7. the competitors promotional strategies
  8. availability of media that is most accessible to its customers