Module 6

Marketing plan

P 133 - 186
 What do you need to know
• Identify the four factors that make up the marketing mix
– Identify the nature of your product
• Explain the importance of packaging and packaging strategies
– Identify the importance of pricing
• What are the different pricing techniques
• Calculate cost
• Calculate mark up of the business
• Explain the concept promotion
– Describe promotional advertising for an immediate sale
– How can advertising media be used
– Explain how to create an advertising message
– How much to invest in advertising
– Describe promotional methods
– Concept of personal selling
– How to increase turnover
– Various forms of guarantees
• Explain the concept place
– What is the concept of locality
– How would your business layout look

P 133
 Marketing Mix
Packaging

Product
Labels

Mark-up
Price
Pricing Technique
Marketing Mix
Advertising
Promotion
Sales

Locality
Place
Lay-out
P 135 - 136
 1. Product
• Product classification
– Industrial products
•‘
– Necessities
•‘
– Impulse products
•‘
– Convenience products
•‘
– Specialty products and luxury items
•‘

P 137
 Packaging
The wrapping or container that the product comes
in. used to protect the product but also used to
promote the product
• Types of packaging
– Kaleidoscopic
– Family packaging
– Re-usable packaging
– Multiple packaging
– Sustainable packaging

P 139 - 146
 Kaleidoscopic Packaging
• Has colourful printing and photos on it.
• Often seen on toys

P 139 - 146
 Family Packaging
• The products in the brand packaged in a
similar way
• Easier to identify

P 141
 Re-usable Packaging
• Containers can be re-used once the product is
finished

P 142
 Individual Packaging
• Each products packaging is unique
• Gives it a special appeal

P 142
 Multiple Packaging
• Different products packed together in a box
for a specific purpose
• Main goal is to increase sails

P 143
 Sustainable Packaging
• Minimise environmental footprint
• Companies taking responsibility

P 145
• Labels
– A printed sticker that appears on the product
– Items that should be on the label:
• Name of product
• Who made product
• Logo and address
• Contents
• Nutritional information
• Quantity of the content
• Expiry date
• Any certifications
• Any allergies

P 147
 2. Pricing for profit
• Factors influencing pricing
– Your target market
•‘
– Competitors
•‘
– Convenience
•‘
– Product Costing
•‘
– Break-even point
•‘
– Government regulations and laws
•‘
P 148 - 151
• Pricing Techniques
– Price Skimming
•‘
– Competitive pricing
•‘
– Cost-plus pricing
•‘
– Odd pricing
•‘
– “Loss-leader” pricing
•‘
– Discounts
•‘
– Penetration pricing
•‘
P 151 - 153
 Steps to determine the cost price of a
product calculation
Step 1
Determine variable costs per products
Step 2
Add all potential fixed costs
Step 3
Add all the start up costs
Step 4
Add the loan repayment amount
Step 5
Compile a sales forecast to determine how many products you will be
able to sell
Step 6
Multiuply variable cost per product
Step 7
Add your variable and fixed cost to determine total monthly sales
P 154
 Methods of promotion

Promotion Methods

Advertising Personal Selling

Sales Promotion Customer Relations

P111
 3. Promotion
• Goals of advertising/promotion
– Tell them about the existence of your business
•‘
– Get them to visit
•‘
– Get them to buy
•‘
– Convince them to come back
•‘

P 157 - 158
 Difference between Promotional
advertising and Goodwill advertising
• Promotional advertising
– Introduces a product
– Raise awareness of the brand
– Inform customers about the product
– Builds and expands the brand
• Goodwill advertising
– Creates awareness of a social cause
– Get people to contribute
– Educate people on a certain product
– Most of the time not for profit gain

P 157 - 158
 Selecting Advertising Media
• Criteria when selecting advertising media
– How many people can you reach
– Who is the target market
– Cost of the various media
– Credibility of the medium
• Where to advertise
Medium Advantages Disadvantages
Newspapers Cover a certain area One language only
Social media Costs little wide audience Intrusion of privacy
Posters Placed in specific area Costly if area is big
Billboards Extremely visible Expensive
Pamphlets Effective if they are creative Often seen as junk mail

Website If customer searches for Limited reach

specific product P 160
 Developing an advertising plan
Creating an advertising message
• Design a message that reflects the image of the
business
• Plan in advance A – Get attention
I - Interest
• Use attention getting techniques D - Desire
A – Action
• Design the message to be short
• Highlight benefits to the customer
• Choose colors carefully
• Let headlines grab the reader
• Use pictures that compliment the products
• Identify your business clearly
• Include the price if you can
P 164
The advertising policy of your business is that
10% of all potential sales will be spent on
advertising. Use the following information and
complete the advertising budget for the first
quarter of your business. The potential sales for
January, February, March and April are R5 000,
R10 500, R9500 and R0 respectively
Factors to consider when deciding how
much to invest in advertising
• Target audience
– What media do they use
• Previous marketing budgets
– What did you spend before and was it effective
• Marketing goals
– What do you want to achieve
• What media to use to advertise
– Knowing your target market
• How often do you want to advertise
– For how long do you want to advertise

P 168
• Public relations (Publicity)
– Serves two functions
• Protecting business reputation
• Shapes public perception of the brand
• Marketing tools which cost little
– Include information on new products
– Use switchboard to communicate information
– Insert links in emails
– Facebook, Instagram

P 168 - 169
 Sales promotion
• Activities where direct contact with customer is
made while promoting your product
• Sales promotion methods
–‘
–‘
–‘
–‘
• Advantages of sales promotions
–‘
–‘
–‘
–‘
P 169 - 170
 Personal selling
• Know the features and benefits of your
product
• Know the business
• Know the prices and discounts
• Know what is happening in the market place
• Know the different selling techniques

P 171
 Dealing with customers on a one on one basis
1. Know all products and prices as well as those pf
competitors
2. Great and treat them friendly and professional
3. Match customers need with the product
4. Sell the benefit and later explain the features
5. Handle objections carefully
6. Closing the sale is all about timing
7. Call later to confirm customer is happy

P 171
 1. Preparation

8. follow-up 2. First contact

7. Final greeting 3. Qualify needs

6. Close the sale

4. Sell benefits

5. Handle objections

P 172
• Turning slow moving inventory into cash
– Sale
• Sell products at a lower price while still making a profit
– Displays
• Place items elsewhere
– Stock clearance
• Sell at cost price
– Return stock to supplier
• If possible
– Offer free shipping
• Offer free shipping

P 176
• After sales service
– Support given to customer after they have purchased
a product
• Benefits as a marketing tool:
– ‘
–‘
–‘
• Forms of warranties
• Implied warranty
– Customers expect product to work as stated on the
label
• Express warrant
– Agreement between manufacturer and seller, stating
that faulty products will be repaired
P 177
 4. Place
• Locality
– Where business is located
• Distribution
– How the product is made available to customers
• Criteria for locating a retailer and service business:
– Customers will not go out of their way to come to you unless there is
something specific they are looking for
– Location is not important if the service is done on the customers
premises
• Important points when locating a business:
– ‘
– ‘
– ‘
• Manufacturing business
– Nature of product that you manufacture will influence location of
your business
– Industrial area
P 179 - 180
• Layout of manufacturing business:
– Smooth work flow is the main object
– Design influenced by:
• Type of product
• Production process
• Economic considerations
• Space

P 181
 Types of layouts

• 1. production layout:
– Sequence of the operations
– Raw material consumer
– Mass production

Shoe manufacturer
Die leather cut leather stitch leather to soles pack shoes in boxes

– Group according to the function they perform

 4 3

5 6 7 8

1 Entrance
2 Fresh Fruit
9 9 9 9 3 Bread
4 Meat
5 Dairy
6 Cold Drinks
7 House Ware
10 8 Canned Food
9 Impulse Goods and Cashiers
10 Exit
END