Marketing Mix and the 4 P's

Question 1

• Marketing mix

Answer 1

A set of controllable variables that must be managed to satisfy the target market and achieve organizational objectives

Question 2

• The four P’s:

Answer 2

product (the good or service), price (what the consumer pays), place (location where the product is marketed), promotion (advertising)

Question 3

• What do the 4 P’s do?

Answer 3

o Allow companies to identify some key factors for their business, including what consumers want from them, how their product or service meets or fails to meet those needs, how their product or service is perceived in the world, how they stand out from their competitors, and how they interact with their customers.

Question 4

• Product:

Answer 4

o Product refers to a good or service that a company offers to customers.
o product should fulfill an existing consumer demand. Or a product may be so compelling that consumers believe they need to have it and it creates a new demand.
o need to understand the life cycle of a product, and business executives need to have a plan for dealing with products at every stage of their life cycle.

Question 5

Marketing introduction and development stage

Answer 5

This product life cycle stage involves developing a market strategy, usually through an investment in advertising and marketing to make consumers aware of the product and its benefits.

At this stage, sales tend to be slow as demand is created. This stage can take time to move through, depending on the complexity of the product, how new and innovative it is, how it suits customer needs and whether there is any competition in the marketplace. A new product development that is suited to customer needs is more likely to succeed, but there is plenty of evidence that products can fail at this point, meaning that stage two is never reached. For this reason, many companies prefer to follow in the footsteps of an innovative pioneer, improving an existing product and releasing their own version.

Question 6

Market growth stage

Answer 6

If a product successfully navigates through the market introduction it is ready to enter the growth stage of the life cycle. This should see growing demand promote an increase in production and the product becoming more widely available.

The steady growth of the market introduction and development stage now turns into a sharp upturn as the product takes off. At this point competitors may enter the market with their own versions of your product – either direct copies or with some improvements. Branding becomes important to maintain your position in the marketplace as the consumer is given a choice to go elsewhere. Product pricing and availability in the marketplace become important factors to continue driving sales in the face of increasing competition. At this point the life cycle moves to stage three; market maturity.

Question 7

Price

Answer 7

o Price is the cost consumers pay for a product. Marketers must link the price to the product’s real and perceived value, but they also must consider supply costs, seasonal discounts, and competitors’ prices.
o Marketers also need to determine when and if discounting is appropriate. A discount can sometimes draw in more customers, but it can also give the impression that the product is less exclusive or less of a luxury compared to when it is was priced higher.

Question 8

Global Pricing Strategy

Answer 8

 Pricing task is more complicated in foreign markets because of problems associated with tariffs, antidumping laws, taxes, inflation, and currency conversion
 Import duties are a major constraint

Question 9

Place

Answer 9

o determine where they should sell a product and how to deliver the product to the market (distribution channels). The goal of business executives is always to get their products in front of the consumers that are the most likely to buy them.
o this may refer to placing a product in certain stores, but it also refers to the product’s placement on a specific store’s display. In some cases, placement may refer to the act of including a product on television shows, in films, or on web pages in order to garner attention for the product.

Question 10

Promotion

Answer 10

o Promotion includes advertising, public relations, and promotional strategy. The goal of promoting a product is to reveal to consumers why they need it and why they should pay a certain price for it.
o Marketers tend to tie promotion and placement elements together so they can reach their core audiences.