Marketing Mix Flashcards
is the core of the marketing mix and defines what will be priced, promoted, and distributed
product
are often classified intofour groups related to different kinds ofbuying decisions
Convenience - bread, pain reliever, power cords
Shopping - shoes, microwaves
Specialty - highly differentiated, custom goods
Unsought products - funeral plots, pest-control
consumer product
An identifier A promise An asset A set ofperceptions A “mind share”
brand
Visual design elements - logo, color, images, tagline, packaging, etc.
Distinctive product features - quality, design sensibility, personality, etc.
tangable
Customers’ experience with a product or company - reputation, customer experience
intangible
Attributes:specific product features
Benefits:attributes translate into functional and emotional benefits
Values:company values and operational principles
Culture:cultural elements of the company and brand
Personality:strongbrands often project a distinctivepersonality
User:brands may suggest the
typesof consumers who buy
and use the product
brands meaning
Branded house - Apple, BMW House of brands - Tang, Kool Aid Private label or store branding - Safeway Organics “No brand” branding Personal and organizational Place branding - Las Vegas Co-branding - Liz Lange at Target Licensing – see image to right Brand extension and line extension - Diet Coke, Jell-O pudding pops
branding strategies
What is the market opportunity for this product?
What are the costs to bring the product to market?
What are the costs through the product life cycle?
Where does the product fit in the product portfolio and how willit impact existing product sales?
How does this product impact the brand?
How does this product impact other corporate objectives such as social responsibility?
business case analysis
Profit-oriented pricing
Competitor-oriented pricing
Customer-oriented pricing
price strategies
Focus on finances of business and product
profit = revenue - price
Price per product is set higher than the total cost of producing and selling cost
Ensures company makes a profit on each sale
Risks
Customers don’t care about a company’s costs
Competitors can undercut pricing
Limits pricing flexiblity
profited oriented pricing
Price based on competitors costs
Price either to indicate that the company believes its product provides greater value or lower to be a low-price solution
Simple way to price products
Risks
Does not fully take into account the value of the product to the customer
might be priced too low for the value it provides, or too high
competitive oriented pricing
Customer uses several criteria to decidehow much they are willing to spendin order to satisfy that need
In order to increase value, the business can either increase the perceived benefits or reduce the perceived costs
Today’s marketing tends to favor customer-oriented pricing because itprioritizes the customer and the customer’s perception of value
customer oriented pricing
value = perceived benefits - perceived costs
customer oriented pricing equation
At what price would you consider the product to be so expensive that you would not consider buying it? (Too expensive)
At what price would you consider the product to be priced so low that you would feel the quality couldn’t be very good? (Too cheap)
At what price would you consider the product starting to get expensive, such that it’s not out of the question, but you would have to give some thought to buying it? (Expensive/High Side)
At what price would you consider the product to be a bargain—a great buy for the money? (Cheap/Good Value)
Van WesterndorpPrice-sensitivity Meter
The difference between the average cost and price of all merchandise in stock, for a particular department, or for an individual item
markup
Quantity discounts
Seasonal discounts
Cash discounts
Trade discounts (given to middlemen)
Personal allowances (rewards to salespeople) Trade-in allowances (cars) Price bundling (cable package)
discounting strategies
cover all the activities needed to transfer the ownership of goods and move them from the point of production to the point of consumption These activities include: product flow negotiation flow ownership flow information flow promotion flow
Distribution channels
While channels can be very complex, there is a set of channel structures that can be identified in most transactions: Direct channel Retail channel Wholesale channel Agent channel
channel structures
The supply chain and marketing channels can be differentiated in the following ways
Supply chain is broader than marketing channels
Marketing channels are purely customer facing
Marketing channels are part of the marketing mix
supply vs marketing
The process of coordinating all the promotional activity across these different methods Seven common marketing communication methods are Advertising Public relations Personal selling Sales promotion Digital marketing Direct marketing Guerrilla marketing
intergrated marketing communication
Advertising is any paid form of communication from an identified sponsor or source that draws attention to ideas, goods, services or the sponsor itself
Advertising has three primary objectives: to inform, to persuade, and to remind
advertising
is the process of maintaining a favorable image and building beneficial relationships between an organization and the public communities, groups, and people it serves
Unlike advertising, public relations does not payfor attention and publicity
public relations
usesin-person interaction to sell products and services
This type of communication is carried out by sales representatives, who are the personal connection between a buyer anda company or a company’s products or services
personal selling
activities bypass intermediaries and communicate directly with the individual consumer Direct marketing can be a powerful tool for anticipating and predicting customer needs and behaviors Over time, as companies use consumer data to understand their target audiences and market dynamics, they can develop more effective campaigns and offers The disadvantage of direct marketing are concerns about privacy and information security
direct marketing
