Micro – 5 P’s of Marketing

marketing definition
the process by which a company creates, captures, and sustains value for its chosen customers
align activities to
fit with target market
breakdowns of chosen customer
demographic, geographic, lifestyle
four types of market sizes you can target
mass market (teenagers), segment (boys), niche (gamers), individual (first person shooter)
the 5 P’s
positioning, promotion, product, place, price,
promotion, product, place, and price used to
achieve strategy
product
the full experience from the customers prospective
product breadth for apple
iphone, ipod, imac etc
product length for apple
iphone 4, iphone 5, iphone 5s
product depth for apple
16 gb, 32 gb, white, black, gold
4 Key Question
can it profitably satisfy the target market? differentiated from competitors? how does it impact my business (i.e. no cannibalizing, does it compliment)? impact on brand?
place
how to get the product to your customers channels of distribution.
categories of distribution
direct, indirect
agent model
manufacturer sets price, pays the channel a commission
business that use agent model
insurance agents, app store
reseller model
manufacturer sells product to channel, channel sets the price
business that use reseller agent
retail stores, amazon books
questions for channel management
monitoring channel conflict, who is responsible for what?
promotion
1. Advertising
2. Promotion closes sale
3. Public relations
4. Sales force- direct and indirect
goals of advertising
create awareness, describe features/benefits of product, differentiate
public relations
unpaid advertising ex: product review, press release
promotion to the consumer
trade that the manufacturer pays the channel for
two promotion strategies
push and pull
push
channel promotes product
pull
manufacturer creates demand
price models
cost plus, customized pricing, skim, penetration, none/reactive
cost plus
cost plus a percentage for product. used in retail, construction
customized pricing
maximize profits based on market factors. used in hotels, airplanes
skim
capture profits, start high and eventually drop prices. used in tech industry
penetration pricing
capture market share, start low and raise when you have market share. used for apps (freemium)
none/reactive pricing
price based on competition
factors for price
positioning, cost, competition, quantity, scarcity
reasons for a price war
gain market share, hurt competition, generate revenue
more complicated reasons for price war
big manufacturing plant with high costs that must be met, attempt to maintain volume
Positioning
Strategy
– Cost profitability
– Competition
-Quantity purchased
Product
Full experience, McDonalds (Burgers, playhouse, fast, cheap)
Direct
Manufacturer sells to indirect users
Indirect
Doesn’t (retailers, online)
Mix/Hybrid
Direct and indirect
Channel Design
How many? What type? Direct/indirect/hybrid?