Marketing – Lecture 1 – Marketing Mix and Product

Define Marketing
– a human activity directed at satisfying needs and wants through exchange processes (Kotler 1987)
Marketing Mix
A unique blend of product, place, promotion, and pricing strategies designed to produce mutually satisfying exchanges with a target market.
Target Market
Target Market
a particular group of consumers at which a product or service is aimed
Managerial process
An activity geared towards giving customers what they want
Identifies and anticipate customer requirements [needs]
Fulfils customer requirements efficiently and profitably [Price, Place]
Facilitates exchange relationships [Place]
Communicates with customers [Promotion]
Marketing mix for a product
Product – Product mix/lines, Product Levels, Product life Cycle, Branding, Packaging
Price – Objectives, strategies
Promotion – Communications mix, elements of the communications mix, Adv and disadv
Place – Channels of distribution and their functions, direct Vs Indirect
marketing mix for a service
Product – What exactly are you offering your customers – i.e. Hotel [Restaurant experience, accommodation, bar, gym etc….]
Price – Objectives, strategies
Promotion – Communications mix, elements of the communications mix, Adv and disadv
Place – Location of service provision and proximity to customer
Process – how the service is offered/delivered
Physical evidence – layout, ambiance
People – Staffing, customer service, Management
Want
goods or services that are not necessary but that we desire or wish for. For example, one needs clothes, but one may not need designer clothes.
Need
goods or services that are required. This would include the needs for food, clothing, shelter and health care.
Consumer market [Business to Consumer]
markets for products and services bought by individuals for their own or family use. Goods bought in consumer markets can be categorised in several ways:
Industrial Market
Involve the sale of goods between businesses. These are goods that are not aimed directly at consumers.
Soft goods
similar to consumer durables, except that they wear out more quickly and therefore have a shorter replacement cycle
– Examples include clothes, shoes
Services
e.g. hairdressing, dentists, childcare)
FMCG
Products that are sold quickly and at relatively low cost. Examples include non-durable goods such as soft drinks, toiletries, over-the-counter drugs, toys, processed foods and many other consumables.
USP
Differentiates a product from its competitors, such as the lowest cost, the highest quality or the first-ever product of its kind. A USP could be thought of as “what you have that competitors don’t.”
Name the different levels of a product
Core level
Actual
Augmented product level
Potential product level
Product Mix
All products sold by a company
Product line
a group of closely related product items
Apple – Nano, touch, shuffle, iPhone, iPad etc..
Product Mix – width –
depends on number of product lines – is the number of different products a company makes (Apple – Nano, touch, shuffle, iPhone, iPad etc…)
Product line depth
is the different versions of each product that are produced (iPhone 5/6, 3G/4, 8mb, 16mb etc…)
Define Branding
A name, term, symbol or design which is intended to signify the goods or services of one seller and to differentiate them from those of competitors (Kotler)

establishing an identity for a product that distinguishes from its competitors

What are the key elements of a brand?
– Brand Message – the message that the org wishes to communicate to the customer about the qualities of the product-
– Brand Name – that part of a brand that can be spoken
– Brand Mark – the element of the brand not made up of words [image]
– Brand Identity – how the company sees itself and the product
– Brand Image – how outsiders see the organisation and its products
– Brand Message – the message that the org wishes to communicate to the customer about the qualities of the product
What are the Key functions of branding?
Differentiates product from competitors
Aids in advertising
Builds customer loyalty
Facilitates product recall
Communicates the value of the product
Allows company to target market segments
promotes product
conveys product image
Brand Leader
brand with highest market share
Brand awareness
familiarity with the brand
Brand recall
the extent to which a customer can recall the name of a brand
Brand loyalty
Customers that are loyal to the brand and will make repeat purchases
Brand switching
changes in customers brand preference
Define packaging
A product’s container, label and graphic design
function of packaging?
Protection of contents from damage and deterioration
Provision of product information [communications]
Promotion of corporate identity [Branding]
Forms part of the sale promotion
Adds to the appeal of the product
Product Life Cycle
Product Life Cycle
The stages through which goods and services move from the time they are introduced on the market until they are taken off the market.
Name the stages in the product Life Cycle
New Product Development
Introduction
Growth
Maturity
Saturation
Decline
Product Life Cycle – Market introduction stage
Create awareness of the product/service
Coupons, samples, promotion – direct/indirect marketing
Costs high – advertising, distribution
Sales volume low
No/little competition – competitive manufacturers watch for acceptance/segment growth
Losses
Growth stage
-Costs reduced due to economies of scale*
-Sales volume increases significantly
-Profitability
-Good Public awareness
-Competition begins to increase with a few new players in establishing market
-Prices set to maximize market share
Mature stage
-Costs are very low as you are well established in market & no need for publicity
-Sales volume peaks
-Increase in competitive offerings [more competitors on the market
-Prices tend to drop due to the proliferation of increase in competing products
-Brand differentiation, feature diversification, as each player seeks to differentiate from competition with “how much product” is offered
-Very profitable
Decline or Stability stage
-Sales volume decline or stabilize
-Prices, profitability diminish
-Profit becomes more a challenge of production/distribution efficiency than increased sales
Questions on Product Life Cycle
Using the PLC, specify what stage a product is at within an industry on its life cycle and explain why? ( i.e. Apple iPad, Kindle, etc.) Draw product life cycle and indicate at what stage you feel the p
roduct highlighted in the exam is at and WHY