The document discusses the marketing mix, which involves four Ps - product, price, place, and promotion. It focuses on the product P, explaining the importance of the product in the marketing mix and the types of products. It also discusses product development process, factors for a successful product, costs and benefits of new products, importance of branding, packaging, product life cycle, and strategies to extend the life cycle.
The document discusses the marketing mix, which involves four Ps - product, price, place, and promotion. It focuses on the product P, explaining the importance of the product in the marketing mix and the types of products. It also discusses product development process, factors for a successful product, costs and benefits of new products, importance of branding, packaging, product life cycle, and strategies to extend the life cycle.
The document discusses the marketing mix, which involves four Ps - product, price, place, and promotion. It focuses on the product P, explaining the importance of the product in the marketing mix and the types of products. It also discusses product development process, factors for a successful product, costs and benefits of new products, importance of branding, packaging, product life cycle, and strategies to extend the life cycle.
The document discusses the marketing mix, which involves four Ps - product, price, place, and promotion. It focuses on the product P, explaining the importance of the product in the marketing mix and the types of products. It also discusses product development process, factors for a successful product, costs and benefits of new products, importance of branding, packaging, product life cycle, and strategies to extend the life cycle.
The marketing mix: is a term which is used to describe all the activities which go into marketing a product. These activities are often summarized as the four Ps – product, price, place and promotion.
The four Ps of the marketing mix
1. Product This involves the design, quality and packaging of the product 2. Price This is concerned with price at which the product is sold in comparison to that of competitors. Price should cover cost in the long run 3. Place This refers to the channels of distribution that are selected. Will they choose direct channel or channels with intermediaries. 4. Promotion This involves how the product is advertised and promoted. Which media should they advertise in and what type of sales promotion to use.
The role of product decisions in the marketing mix
The product itself is the most important element in the marketing mix, without the rest of the product the rest of the marketing mix is pointless. Most products nowadays are market orientated which means they spend a lot of money on researching consumers’ buying habits, likes and dislikes in order to design a product which meets their expectations.
Types of products include:
1. Consumer goods: are goods which are consumed by people; e.g. food or furniture 2. Consumer services: are services that are produced for people; e.g. hairdressing or education 3. Producer goods: are goods that are produced for other businesses to use. They help with the production process; e.g. lorries or machinery 4. Producer services: are services that are produced to help other businesses; e.g. insurance or banking Categorizing the type of the product will help in deciding how the product will be developed and marketed. Promotion of a producer good will be quite different from promotion of a consumer good.
What makes a product successful?
1. It has to satisfy existing needs and wants of consumers
2. Design in terms of performance, reliability, quality should be consistent with the product’s brand image and with the price charged 3. It should be capable of stimulating new wants from the consumer 4. Should not be too expensive to produce in order to allow for a reasonable price 5. The first business to produce new product or introduce new changes to the original product before its competitors 6. Has a distinctive feature that makes it unique
Product development Product development goes through the following process:
generate ideas
select the best ideas for further reserarch
decide if the company will be able to sell enough for the product to be a success
develop a prototype
launch the product in one part of the country to test the market
go to a full launch of the product to the whole market
The costs and benefits of developing new products Developing new products has the following benefits:
1. USP: is the special feature of a product that differentiates it from the products of competitors 2. Diversification of the business 3. Expansion into new markets 4. Expansion into the existing markets
Cost of developing new products:
1. Market research is expensive
2. Producing trial products is expensive including the costs of wasted materials 3. Lack of sales if the target market is wrong 4. Loss of company image if the new product fails to meet customer needs
The importance of brand image
Brand name: is the unique name of a product that distinguishes it from other brands
Brand names are usually rely on advertising to make consumers aware of the qualities of the product and try to persuade them to buy it. Brand names are usually perceived by consumers as being of higher quality than unbranded ones. Brands have an assured standard quality that makes consumers confident in buying branded products. This also may lead to consumer loyalty; which keeps the customer buying the same brand of a product instead of trying to buy similar products. Brands will have a whole brand image; is an image or identity given to a product which gives it a personality of its own and distinguishes it from its competitors’ brands.
The role of packaging
Packaging: is the physical container or wrapping for a product. It is also used for promotion and selling appeal. The packaging has the following functions:
1. Has to be suitable for the product to be put in to give protection and not allow it to spoil. It also has to allow the product to be used easily. It Should also allow it to be transported easily without any damages. 2. It is also used for promoting the product. It has to appeal to the consumer and reinforce the brand image. 3. The labels on products sometimes have to carry vital information about the product; legal requirement.
The product life cycle
Product life cycle: describes the stages a product will pass through from its introduction, through its growth until it is mature and then finally its decline.
The exact length of the life cycle, in terms of time, varies from one product to another. Usually it is affected by the type of product. For example, new developments in technology will make original product obsolete and their life cycle will come to a quick end as new products are purchased in preference to old technology. In contrast, products like CoCa Cola have a very long life cycle. Knowledge of the stage in which a product is in will help in marketing decisions. A typical cycle for a product is as follows:
Stages Product Sales & profit promotion Price
Development Prototype is No sales – high cost tested and market research carried out before launch Introduction Basic model Sales grow slowly Informative Price skimming in case advertising – as of new development & product is unknown no competition penetration pricing in case of competition Growth Sales grow Persuasive Promotional pricing due rapidly advertising to to entrance of Profits are encourage brand competition made as loyalty development costs are covered Maturity New models, Sales increase More persuasive Competitive or colors, slowly advertising to promotional pricing due accessories Profits are at maintain sales to intense competition their highest growth Saturation Sales are stable High and stable Price reductions to stay at their highest level of competitive pricing points advertising Profits start to fall due to static sales and price reductions Decline Slowly withdraw Sales is too low advertising is further price reductions from market – unprofitable reduced and is replace with only there to new ones announce price reductions – then it will stop Extending the product life cycle To stop sales from falling a business will start adopting extension strategies. The following strategies will result in giving sales a boost:
introduce new variations of the original product
selling into new markets make small changes to the product’s design, color or packaging use a new advertising campaign introduce new improved version of the old product sell through additional different outlets
The effect of the extension strategies is as follows:
