ENTREPRENEURSHIP

Module 3. The Marketing Plan

At the end of this module, I can:

1. Describe the unique selling proposition and value proposition that differentiates one’s product/service from
existing products/services.
2. Determine who the costumers are I terms of the following:
a. Target Market
b. Customers requirements
c. Market Size
3. Validate customer-related concerns through the following:
a. interview c. observation
b. focus group discussion d. survey
4. Describe the marketing mix (7Ps) in relation to the business opportunity and vice versa:
a. product e. people
b. place f. packaging
c. price g. process
d. promotion
5. Develop a brand name.
_____________________________________________________________________________

After the comprehensive processes of seeking, screening, and seizing the opportunity, it is now time for the
entrepreneur to focus on the chosen business and dig deep. Entrepreneurs must write a business plan. A business plan is
a comprehensive paper that details the situation analysis, objectives , strategies and tactics, and how to monitor and
control the enterprise. This module will familiarize you on how to prepare a strategic marketing plan as a first
component of the business plan. Some entrepreneurs fail to give importance to the voice of a business venture-the
market. If ignored or given small attention, this becomes a major source of the entrepreneur’s failure.

This module will also let you understand and identify what makes a product or service stand out fro the
competitors through defining the unique selling proposition and value proposition of the product or service. You will
understand the behavior, attitude, and psychology of the entrepreneur’s customers through various ways of customer
validation. You will understand in detail and apply the 7Ps of marketing mix in instigating awareness and driving sales of
the business venture. Last, you will understand the fundamentals in brand management and how branding gives a
specific business an overall appeal and credibility.

Value proposition and Unique selling proposition

Before focusing on the topics of value proposition and unique selling proposition, you must first know the
marketing process. In a nutshell, marketing is all about knowing the customers. Therefore, the marketing process starts
with identifying the customers’ needs where you are tasked to create a meaningful value proposition. Next, you study
what the customers want or desire for you to build a unique selling proposition. From there, it is imperative to identify
the most strategic market or group to tap.

A value proposition (VP) simply states why customer should buy a certain product or service. Customers are very
specific when it comes to their needs and their desired benefits, so the value proposition should cater to those particular
needs. Thus, the value proposition is the major diver in customer per chase or service availment. The stratup
entrepreneur will surely have a hard time thinking of a value proposition for his or her business. The entrepreneur
should bear in mind that a value proposition has to be direct in addressing the problems of the customer, should have
quantifiable benefits, and should differentiate itself from the competitors.
 The following are some tips for the entrepreneur on how to create an effective value proposition to the target
customers:

1. Prepare a situation analysis that details the problem (s) of the customers.

2. Make your value proposition straight to the point, simple, and specific; in short, there should be know
complications. Your value proposition has to target your major objective.

3. Highlight the value of your product or service so that customers will easily get what benefits you can provide.

4. Adapt to the language of your market. Ensure that your target market understands clearly what you are trying to
say and avoid putting unnecessary in explicable places.

5. Add credibility-enhancing elements such as actual testimonials from customers, partners, and other
stakeholders, putting specific assurance elements and social acceptability metrics from in social media and press
materials. Several quality management certification, such as the ISO seal, add more credibility to the product or
service that you are trying to sell.

6. Differentiate your value proposition with your competitors. Examples of value proposition differentiators are the
originality of the product or service, its functionalities, or if the product or service can be tailor-fitted to the
customer’s preference, among others.

7. To illustrate, here is a sample potential value proposition from the most common small businesses in the
Philippines.

8. Aling Tere’s sari-sari Store

9. Situation analysis:

10. Prior the establishment of a sari-sari store, aling tere notices that there is a convenience store in her
vicinity, where many call center agents, nurses, and construction workers buy food, beverages, and other
products during odd hours (from 10 pm to 6 am). She discovers that the customers either ride a tricycle or a
jeepney just to reach the convenience store. There are two sari-sari stores nearby, but they close at 9 pm. Aling
tere believes this an opportunity for a sari-sari store business with a twist. Aling tere realizes she needs to
address the needs the needs of the customers to differentiate her business from the competition. She decides to
establish a 24/7 sari-sari store. As an initial investment, aling tere hires three employees who will help her run
the sari-sari store in three shifts. During their break, aling tere mans the sari-sari store herself. She designs her
sari-sari store like a semi convenience store, where customer can freely go and choose the product they want. It
is also air-conditioned. For security purposes, she also installs a CCTV camera. He task now is to craft a
worthwhile value proposition for the potential customers.

Proposed value proposition: “Tindahang maasahan, bukas kahit anong oras!”

Why should be this considered an effective value proposition? It is specific and straight to the point. It
describes what the business is by referring to tindahan──a Filipino term for a basic retail store. It highlights the
value to the customers that they can buy their basic necessities from this value proposition because the phrase
“bukas kahit anong oras” signifies a guarantee that customers will be served anytime of the day. And last, aling
tere’s store is the only sari-sari store that is open 24/7, which makes her store different from competitors.

On the other hand, a unique selling proposition (USP) refers to how you will sell the product or service
to your customers. It addresses the customers’ wants and desires. After you create your value proposition, you
have to figure out to how to advertise or promote certain unique features of the product or service that you’re
trying to sell. You can do this in the form of product or service characteristics, promotion strategies and tactics,
distribution centers and supply chains, pricing, physical attributes or physical evidence, human resources or
 human capital, and market positioning strategies. The ability to crafts an effective USP is gauge on how well an
entrepreneur knows his or her product or service.

The following are some tips for the entrepreneur on how to create an effective unique selling proposition to the
target customers:

1. Identify and rank the uniqueness of the product or service attribute. This is the most difficult part
because you only need to choose on or two at the most. That attribute will be your key to success, as this will
compel customers to purchase from you and not from your competitors. The unique selling proposition, while it
presents the best features of your product or service, should also avoid competition. Put your self in the
customers’ shoes and ask yourself, “why should I choose you over the others? Or, “why should I deal you at all?”
identifying the unique selling point is a tough job and requires marketing research. The best way to identify it is
to identify the marketing mix (7Ps) and distinguish which among those displays the product’s unique features.
The 7ps will be discussed later in this module.

2. Be very specific. Out details that emphasize the differentiators against the competitors. This
differentiators should be very compelling and should make the customers think that they are really getting more
value from you than the others. By being a specific, make sure that the USP does not rely on heavy, extravagant
promotion. The customers do not want to feel that they are being fooled.

3. KISS (keep it short and simple). One challenge that marketers always face is that the customers’
attentions pan is limited and very easy to switch. Therefore, think of a very catchy unique selling proposition in
the simplest and shortest way possible. You can compare it with a headline of a newspaper or a website. That’s
the first item that the customer will see.

To illustrate, use the sample from the previous discussion to build a potential unique selling proposition for aling
tere’s sari-sari store.

The first step is the identification an ranking of the uniqueness of the product or service attribute using
the 7ps of marketing. Make sure that there peace at through explanation and analysis about the ranking.

The process was ranked first as the most unique because aling tere wants to solve a compelling problem of the
customers, i.e., the availability of a retail store near there where place odd hours. This was based on her marketing
research about her environment. Packaging convenience store and a sari-sari store. People ranked because it is the sari-
sari store that has three persons to work in shifts. It is common that the owner or an assistant attends to the store with a
determine schedule, and not the entire day.

Proposed unique selling proposition: “tindahang maasahan, bukas kahit anong oras!”

You will notice that proposed value proposition and unique selling proposition are the same. Why? Because the
most compelling differentiating factor is positioning, the value proposition is also the perfect unique selling proposition,
considering all the factors numerated were all met (defined unique attribute, specific and short/simple). It is catchy, too.
However, this may not be the best unique selling proposition for aling tere. The entrepreneur,s creativity and
inventiveness will always come into play.

Both the value proposition and unique selling proposition should be clearly communicated to the target
customers in the catchiest way possible. Common communication channels include signage. Web sites, social media,
print ads, television and radio commercials, and mobile advertisements.

Know your costumers

After the general scan and research performed during the course of the preparation for the value proposition
and the unique selling proposition, it is now time to dig deep and understand the target customers through marketing
research. Marketing research is a comprehensive process of understanding the customers’ intricacies and the industry
they revolve in. Marketing research is one of the most critical tasks of an entrepreneur. Therefore, no budding
entrepreneur should establish a business without undergoing the marketing research process or else the business will
surely fail. The result of marketing research is the entrepreneur’s major investment in a business, as it will lead him/her
to most effective strategies to employ. Marketing research aims to scrutinize the target market, their specific
requirements, and the market size where the business operates.

Market Size

Market size is simply the size the arena where the entrepreneur’s business will play. It is the approximation of
the number of buyers and sellers in a particular market. The entrepreneur is required to determine the market size first
to gauge the vastness or tininess of the market where he/she intends to join. The only way to do this is to conduct a
strategic marketing research from reliable sources using dependable methods.

The first step is to estimate the potential market-the approximate number of customers that will buy the
product or avail the service. Usually, this is what you call the market space or the market universe because this is the
total market. For example, rice, the staple food of Filipinos, virtually covers the whole country in terms of market size
because majority of Filipinos eat rice.

The second step is to eliminate the customers who are probably unlikely to buy the product or avail the service.
Using the rice retailing business again, the entrepreneur can already eliminate socioeconomic classes A, B, and C
because most of these customers buy rice in bulk (sacks) or are given freely by some employers. They are also not the
major consumers of rice.

The last step is for entrepreneur to estimate the market share, which is the plotting and calculation of the
competitors’ market share to determine the remaining portion for the new venture. The entrepreneur should first
assess the market situation via surveys, customer reviews, or any other data-gathering methods. From there, he/she will
be able to calculate the number of potential customers that will buy the product or service offered. This will be the basis
to decide whether the business is worth the capital that will be used. Continuing with the rice retail business, because
the entrepreneur already identified socioeconomic classes D and E to be the market size, he/she should plot the number
of rice retail businesses within the vicinity and calculate the market share of each. The remaining portion can be the
potential market share of the rice retailer and can also be increased by those who will switch depending on the effects
of the entrepreneur’s marketing strategies.

Market share computation illustration: Mr. Alvin Antonio, a budding entrepreneur, wants to establish a rice
retailing business in his area in Barangay San Isidro. He wants to know if this business is worth his capital and effort. He
dug deep and found out that there are approximately 500 families in Barangay San Isidro with an average of five
members per family. He did a survey and found out that only 475 families eat rice; they consume an average of 1 kilo of
rice per day. There are four other rice retailers in the area that have been there for 10 years already, and they have
equal market shares of 20% each. The other 20% of the market is buying in bulk (per sack) from groceries or
convenience stores. The average net profit per kilo of rice is P10.

How big is the market size and what could be the potential market share of Alvin’s rice retail business?
 Market size of rice business in San Isidro= Number of families who eat rice x average consumption per annum

Market size = 475 families x 1 kilo per day x 365 days

= 173 375 kilos of rice

Market size profit = 173 375 kilos x ₱ 10

=₱1 733 750 per annum

The objective of Mr. Antonio in the first year is to capture the 20% of the market by implementing marketing
strategies in pricing (reduced markup of ₱2) and promotion (free delivery of rice for 5 kilos up ) through text message or
phone call. None of the competitors have thought of or done these strategies yet. In the example, the four rice retailers
are considered direct competitors because they offer exactly the same product and are structured similarly with Mr.
Antonio’s proposed business. On the other hand, the groceries and convenience stores are considered indirect
competitors because they don’t offer exactly the same product type ( i.e., rice sold in sacks instead of by kilo ) and are
not similarly structured but still compete with Mr. Antonio’s business indirectly.

Potential market share = market size x estimated market share

= ₱1 733 750 x 20%

= ₱346 750

However, because Mr. Antonio will reduce the markup by ₱2, the net profit per kilo will only become ₱8.

Potential market share = 173 375 kilos x 20% x ₱8

Potential market share = ₱277 400

This market share for startup business is an attractive venture. Mr. Antonio also has a bigger chance of
capturing the market share of competitors if he implements relevant and enticing marketing strategies.

Customer Requirements

Customer are said to be the lifeblood of the business. These are the people who buy the products or avail the
services of the entrepreneur. Their thoughts, feelings, and experiences shape the decisions of the business. Thus, the
phrase “the customer is always right” is a mantra that most successful entrepreneur follow. Customer requirements are
specific features and characteristics that the customers need from a product or a service. It is in these customer
requirements that business opportunities originate. Entrepreneurs must be aware of all these requirements for them to
come up with features with best suit their needs.

They must know who buys, and what, when, where, how, and most importantly, why they buy. These requirements can
be used to formulate the value proposition and the unique selling proposition, as addressing the requirements would
increase the competitive edge of the business. Entrepreneurs should also be vigilant with the constant change in
customers will prefer cheaper prices or a bundled menu; some will prefer a cozy ambiance; some will prefer a place with
relaxing music; some will prefer to have food served fast; and some will prefer to pay using their credit card and not
cash. In short, customer requirements vary from person to person. Thus, the entrepreneur must group them together,
calculate their size, and come up with products and services that suit them. The customer is the voice of every business
that every entrepreneur should listen to.

Primary and Secondary Target Market

Most entrepreneurs believe in the misconception that they can serve all types of customers or, if not, a wide
range of customers. Little do they know that this thinking may lead to failure. Entrepreneurs must focus only on
customers whom they can serve beneficially because they will be wasting resources if they will target all, or worse,
target none.
 The entrepreneur can tap a primary target market and a secondary target market as resources are limited during
the startup stage. With this, the probability of success is higher as the entrepreneur can focus to sell to the identified
customers groups. Market intelligence, which includes customer profiling, drives the entrepreneur on what correct
strategies and tactics to employ. This can only be obtained through a meticulous market segmentation process. Market
segmentation is the process of grouping similar homegeneous customer according to demographic, psychographic,
geographic, (location), and behaviour. It is a necessary activity in marketing because it gives the entrepreneur a holistic
and general view of the market group that he or she is serving. Therefore, there will be efficiency and proper logic in
implementing marketing strategies and tactics to this chosen market group.

It is best to create persona(s) of the target customer to represent the general characteristics and behaviour of the target
market. A secondary target market is also necessary to spread out the capital expenditure and risks as well. They the
customers who don’t have enough purchasing power or have fewer demands. They may not be your primary target
market, but they can be converted once effective marketing strategies are implemented.

Demographic

Demographic segmentation, also called socioeconomic segmentation, is the process of grouping customers
according to relevant socioeconomic variables for the business venture. The socioeconomic variables include income
range and social class, occupation, gender, and age, religion, and ethnicity. These data help the entrepreneur target
customers accurately and classify their respective needs, wants, and desires. Demographic data can usually be derived
from public documents or the internet, thereby giving the entrepreneur an easier task of collecting data. To further
validate the information gathered from the public sources, it is still best to do a random sampling just to check if the
data are accurate. The risk in confusing solely on demographic data is that these data change with society. Therefore,
the entrepreneur must be alert with these changes.

Income range and the social class of the customers are very important factors for the entrepreneur to consider because
theses represent the purchasing power of the market. From here, the entrepreneur will be able to determine the extent
to which the customers can buy or avail of the service; therefore, he or she will have an idea on how the profitability will
look. The socioeconomic class of the Philippines according to the 2011 report of SWS (Social weather Stations) is
dominated by the socioeconomic class D with 60% of the families earning an approximate of ₱191 000 per year. This
followed by class E with 30% percent of the families earning only ₱62 000 per year, and then by class C with 9% of the
population earning ₱603 000 per year. Last on the list is class AB with only 1% of the families earning ₱1 857 000 per
annum.

Occupation should also be considered not just to determine the customer’s income but also their daily routine
where goods and services can be properly positioned. In the previous example above of Aling Tere’s sari-sari store, she
based her decision of putting up the store because she has knowledge of customer’s occupations (i,e., call center agents
and night shift nurses).

Gender and age group are data that must be mined because the life cycle of customers and their gender influence their
buying behavior. Here are some practical examples.
Religion and ethnicity also should be taken to account because these affect the way they buy products or avail of
services. Examples are food choices, events and holidays, traditions and belief, spending habits, and conservativeness.

The entrepreneur should be include demographic items that he/she thinks are relevant to the chosen business
so that he can accurately align worthwhile products or services to the customers.

Psychographic

Psychographic segmentation is a process of grouping customers according to their perceptions, way of life,
motivations, and inclinations. Perception is a process wherein an individual receives external stimuli using the five senses
of hearing, touching, smelling, seeing, and tasting. A product or service can be perceived differently by different people.
The customers’ way of life will give an entrepreneur an overview of what products or services can best suit the problems
of the customers that happening on a daily basis. A person’s motivation can be either physiological or psychological.
Physiological motivations involve the needs of the person ( e.g., food, clothing, shelter); they seek to avoid pain and give
pleasure. Psychological motivations involve customer’s preferences (what the customer likes or dislikes)

Motivations are also affected by their aspirations and deprivation. Aspirations are what the customer wants to
achieve ( e.g., inner peace, financial stability, work-life balance).

Deprivation involves the customer’s recognition of certain voids to fill (e.g., lack of financial security, lack of love, lack of
knowledge). For example, let’s look at Jacob, who comes from a low-income background. He wants to become one of
the best accountants, and so he aspires to go to one of the premier universities in Manila to study accountancy. With
this, he is motivated to uplift his reputation and his value, as well as his status on the society or his appreciation of other
people.

Customers’ inclinations involve preferring one product over another as a result of gaining a refreshing
experience when using the product, possibly due to the product’s unique features or due to it giving more value than
other products. Inclinations also encompass the customer’s personal preferences. The entrepreneur must be aware of
what makes the customers buy the products, so he or she will know how to segregate the customers based on their way
of life.

Geographic

Geographic segmentation is simply grouping customers according to their location. This is critical in the analysis
of the target market as this encompasses the cultures, beliefs, preferences, politics, and lifestyle of a certain geography.
Geographic segmentation can be as small as street, a village, or a barangay. It can also be based on municipality, city,
province, or region. It can be as big as a country or continent depending on the entrepreneur’s business objectives.
This segmentation matters more if the locations targeted have different sets of qualities mentioned previously. For
example, meat products such as pork can easily be sold in Region 3 (Central Luzon) and region 4 (Cavite, laguna,
batangas, rizal and quezon, or calabarzon), but it will be difficult to sell in the Autonomous Region in muslim Mindanao
(ARMM) and region 12 or SOCCKSARGEN (South cotabato, cotabato, sultan kudarat, sarangani, and general santos city)
because these regions differ in region. (Remember that muslims do not eat pork). Another example is the establishment
of a taxi business, which is more feasible in metro cebu than in Tawi-tawi because of the lifestyle of the people.
Therefore, the entrepreneur should be able to analyse the intricacies of the locations being targeted and group places
that have similar profiles depending on what is relevant to the product or service to be offered.

Behavioral

Behavioral segmentation is the process of grouping the customers according to their actions. These behaviors
are instigated by occasions, desired benefits, loyalty, and usage of products or availment of services.

Occasions drastically affect the customers’ buying behaviour. The Christmas season entices the people to buy
gifts. The valentine season encourages people to buy flowers and chocolates for their special someone. The summer
season elicits customers to go to the gym to be fit, to the beaches and resorts to beat the heat, to book a trip for a
summer getaway, or to buy summer outfits. Birthdays and graduation induce customers to go to buffets restaurants or
hotels and resorts to celebrate.

Using customers’ desired benefits in behavioural segmentation is efficient because the entrepreneur determines the
exact needs of the customers and offer the most suited product or service for them. Examples include offering wash,
dry, and press services for busy office workers in the city because they don’t have to do this chore, or offering 3-in-1
coffee for budget conscious customers and those who prefer instant coffee.

Loyalty is the result of maintaining satisfied customers. The goal of every entrepreneur is to inform, persuade,
and remind customers to buy the product or avail of the service consistently. Therefore, behavioural segmentation
through loyalty is a major key result area of the entrepreneur as it is more expensive to sell to new customers than to
maintain customers. Loyalty programs and rewards separate loyal customers from the new ones.

Usage of the products or avail of service is also a behaviour segmentation factor that describes to the
entrepreneur how often a product is being used or the service is being availed. Therefore, he or she can group
customers as light users, medium users, or heavy users. For example, there are women who are occasional users for
makeup, and there are girls who wear makeup every day. There are men who are occasional a term in users of hair
products, and there are men who apply wax or gel on a daily basis.

Although segmentation is a strategic and an efficient way classifying and grouping customers, there is also a
term in marketing called market aggregation. Market aggregation happens when an entrepreneur wants to target a
broader market as possible because the product or service that the business offers suited for an undifferentiated market
such as fruits, vegetables, rice, water, and bread as well as services such as haircut, plumbing, or transportation.

Talking to your customers

Marketing research will not be complete without talking directly to the target customers. It is good to estimate
numbers such as market size, market share, and other general market assumptions, but the best way to fully understand
the customers is to ask them about their specific thoughts and desires. Conducting marketing research in a methodical
way will bring the entrepreneur a substantial bunch of relevant ideas that can be used to effectively run the business. A
marketing research should first have a solid objective, which states the research’s purpose. From this objective, you will
identify the appropriate research activities, tools, and samples that will set the scope and the limitation of the research
project. When relevant research methodologies are already defined, you should now identify the target market segment
for the research project, which should be dissected into key samples that represent the target market segment.

Next is to analyze proper timing for research execution. This is important because the entrepreneur will be able
to get maximum results when he/she identifies the respondent’s answering pace. Geography is also important to
determine the behavior of the target market as well as the foot traffic. Last is to establish a market research design that
will effectively implement the steps mentioned. Depending on the objective, responses are either qualitative or
quantitative. Qualitative research includes identifying the written or spoken opinions of customers, whereas
quantitative research involves analyzing the customers’ preferences by using relevant statistics ( such as those in surveys
)

In the succeeding discussion, you will be familiarized with the four most common methods of collecting data from the
target customers: interview, focus group discussion, observation, and survey.

The Interview

The Interview is one of the most reliable and credible ways of getting relevant information from the target
customers. It is a face-to-face contact between the researcher/entrepreneur and a respondent where the researcher
asks pertinent questions that will give him significant pieces of information about the problem the he will solve. It is a
credible way of getting information because the researcher will be able to capture not just verbal but also the nonverbal
answers such as facial expressions, character of words used, or body language. The interview is also helpful even when
the business has already started because customers’ feedback provide the intrepreneur a glimpse of what the customers
think about the business. The drawback though is that interviews are often expnensive, especially if the number of the
respondents is large. The solution is to apply sampling which is the selection of respondents that statistically represent
the total population.

The two main types of interviews being conducted by the researcher are unstructured and structured
interviews. An unstructured interviews is an informal type of interview and does not follow specific set questions. The
researcher has a checklist of high–level issues the he /she wants to clarify with the respondent. It is a preparatory
interview to gather ideas about the problem(s) that will be solved, so that these issues will be considered in the formal
survey questionnaire to be presented to the respondents later.

In this type of interview, the respondent can answer freely including everything that he/she feels about the issues
raised, so long as these are related to the question being asked by the researcher. The researcher will ask all the possible
questions until he/she is satisfied that all necessary issues in his/her checklist have been answered. The researcher
usually records the conversation, reviews it, and summarizes the findings. The unstructured interview produces
qualitative data.

Structured interview, on the other hand, employs a specific set of questions and produces quantitative data. A
prearranged questionnaire with specific questions usually answerable by yes or no (closed-ended), forced ranking,
multiple choice, or choose-the-best will be answered by the respondents. Unlike the unstructured interview, a
structured the interview does not allow the interviewer and the respondent to omit or add questions, nor change the
sequence or how the question are worded. For both methods, the researcher has to be very objective and avoid biases
to come up with impartial answers. He/she should be able to raise relevant questions that can directly give appropriate
answer to the research objective (s).

There are many challenges in an interview. The first challenge involves setting an appointment with an
interviewee, which includes asking the respondent’s permission. Some respondents can be sceptical and need to know
the reputation of the one conducting the interview before allowing themselves to be interviewed. Therefore, the
researcher needs to set a friendly tone and must explain the rationale and the objectives in a clear and nonintimidating
way.

The second challenge involves the respondent’s indifference to how they share their opinions. Introducing the interview
is very important as this will set the tone of the discussion. The entrepreneur, therefore, must establish a relaxed
ambiance and must first explain clearly why the interview is conducted and how it will benefit the interviewee. The
language must be the one that the interviewees use ( usually informal, due to most interviewees being common folk);
the length of the interview must be brief so as not to occupy much of their time; and the interviewees should be assured
that the results be kept confidential and be presented summatively.
 The third challenge involves getting unbiased answers from the respondents. There are factors for such a
challenge. The first factor is the limited memory or forgetfulness of the respondents. The second factor is the difficulty of
the questions, giving the respondents a hard time to answer relatively. The third factor is the environment they are in.
Some respondents in an interview may be influenced by relatives or peers who overhear the interview. Many Filipinos
tend to be courteous, telling you what you want to hear instead of what you need to hear. They may also be influenced
by the interviewer himself/herself by injecting his/her own biases or ideas, by being too compassionate, or by being
surprised or disagreeing. The researcher therefore must have an objective approach to the interview so as not to affect
the results.

The Focus Group Discussion

The focus group discussion or FGD is commonly used by market researches to capture qualitative results from
target customers. It is a process of mining customer and noncustomer experience and insights about a specific product
or service. Through an FGD, the researcher will able to generate relevant concerns and issues of customer such as their
views and inclinations toward a product or service, perceptions or impressions or new product or service models,
innovations of the older product or service, inventive concepts or promotions, price elasticity, and initial feedback of
customers on marketing tactics and advertisements.

What’s unique about FGD is that is led by a moderator who keeps the discussion spontaneous and on the right
track. The moderator’s task is not that of an interviewer who is asking a set of questions. Instead, his or her role is to
encourage a group of participant is to talk about a list of topics prepared prior to the FGD. The moderator will direct the
discussion in the right path, ensuring all angles are covered and the discussion doesn’t go too far from the topic. This is
the reason that it is called FGD, because the discussion will be specifically focused on finding relevant answers (e.g.,
strong branding or service preferences). The moderator must also be objective at all times, avoiding biases and
unnecessary reactions.

The participants, on the other hand, are selected based on the objective of the entrepreneur and should be
homogenous as much as possible. For example, if the entrepreneur wants to know if there is an opportunity for a beauty
salon business in his or her area, then he or she will choose to have female salon experts. If his or her objective is to test
an existing product such as carinderia viands, then he or she will invite a group of students or a group of employees who
are food enthusiasts as participants.

The focus group session usually lasts from one to two hours. It will be more credible if the actual product or a potential
product/service is showcased in the FGD to elicit realistic reaction from the participants. The FGD session must be
recorded by either audio or video, so that the researcher can digest the session and the most relevant insights from the
participants.

In the case of starting entrepreneurs, they don’t necessarily have to follow a formal FGD session, but the
ultimate objective of getting row and fresh responses of the participants must be elicited (e.g., casual conversations with
a group of homogeneous individual such as students, employees, and the factory workers). The FGD is also a
preparatory step in quantitative survey because this method generates background information or hypotheses for a new
product or service. As compared to the interview, the FGD has some advantages as follows:

1. The researcher can get combined insights from the participants.

2. The participants are more spontaneous and enthusiastic because of the interaction with coparticipants, thereby
sharing more insights to the researcher.
3. It can be observed by various spectators.

It also has some disadvantages as follows:

1. It obtains only qualitative data

2. Examination of the focus group session is difficult and requires more time
3. There are potentially biased answers from the participants because they will encounter peer pressure. There
may also be instances that one or two among the eight participants will dominate the discussion, resulting in
biased responses.

FGD illustration for food cart business

Vicky velasquez just retired from her job as a banker for 35years. She is thinking of ways on how to
preserved the retirement benefits she receive from the bank. One day, she notice that while commuting, a lot of
passengers are stopping buy to eat or drink in convenience store or in food carts. They are buying pasalubong
for their loved ones, be it in the form of donuts, ensaymada, siomai, waffles, or siopao. She is interested to put
up food cart business in the terminal, but she is unsure what particular product or combination of products will
be liked sustainably by the passengers. Vicky decides to employ a focus group discussion in knowing the pulse of
the target market─the passengers.
FGD objectives
• to determine the top products that passengers buy for themselves or pasalubong for their families and loved
ones
• To understand the buying behavior of the passengers
• To know if the passengers want new or enhanced merienda or pasalubong products
Participants
• Vicky will invite six passengers who are waiting in line from the bus. All of this passenger have been buying
merienda for themselves pasalubong for their loved ones

Venue and logistics

• An FGD will be held at Vicky’s residence in Santa Rosa City, Laguna, where most of the participants live. She will
set up her dining area as a mini-conference room. As a sign of gratitude, Vicky will provide the participants with
free snack and pasalubong.
Moderator
• Vicky will act as the moderator and will use her smartphone to record the session. As both the moderator and
researcher, Vicky must be able to elicit transparency, objectivity, and kindness, but she should also be firm,
flexible, and sensitive.
Moderator’s discussion guide
A. Introduction (10-15 minutes)- Vicky should be able to explain to the participants the purpose of the FDG and the
ground rules before starting. She should disclose to the participants that she’ll be using her smartphone to
record the session and that responses will be treated with confidentiality. The participants can freely voice their
opinions regarding the topics to be raised and must be speak one at a time with a clear tone.
B. Product usage, attitude, and image discussion (30 minutes)- Vicky will be asking the following questions during
the discussion proper to validate the first two objective:
a. What images are connected with pasalubong products?
b. How were these images derived? Was it trough packaging, price, location, signage, or the
service personnel?
c. What are the words that first come to mind when merienda or pasalubong is
mentioned?
d. What are the top three food cart businesses that you frequently patronize? What products do you
buy from them, and how of these products do you buy (i.e., quantity and amount)? How many times do you buy
in a week?
e. Why do you prefer to buy snacks and pasalubong from these food carts?
C. New or enhanced products (15 minutes)- Vicky will be asking the following questions to validate the third
objective:
a. What new products excite you to be part of the food cart business? Why is this so?
 b. What enhancements or improvements would you like to see in the existing food cart products that
you patronize? Price? Location? Product features? Signage? Service Personnel?
D. Conclusion (5 minutes)
Analysis of FGD results
Because the FGD is a qualitative method of generating ideas because the researcher documents the
behavioural patterns of people or of objects or events without necessarily requiring them to participate in the
research process. One method is to simply watch and examine the customers’ behaviour in their raw estate
without biases and pretentions, thereby providing more accurate results and faster process.
Observation is reliable because it allows the researcher to see the real and actual behavior of customers
rather than hearing what they need to say (which may sometimes to biased, incomplete, sugarcoated, or
exaggerated). Therefore, it is not as pushy as the interview and the FDG.
The key to observation is that the researcher must be keen and accurate on what he/she really
wants to observe-he/she must have a very clear objective. Observation can be performed by either a human or a
machine observer. The human observer records information as it occurs or as it happens using his/her five
senses. The machine observer employs an equipment (e.g., video camera or computer) to record the
information needed.
Examples of human observation:
1. Customer purchase patterns. This humans observation technique uses the researcher to understand the buying
behavior of the customers such as determining their pain points, buying patterns (i.e., how many times and how
often do they buy or their inclinations toward a product or service), location, price, or promotion.
Application to a printing business: The human observer will count and rank the type of printing jobs
requested by the customers such as determining their pain points, buying patterns (i.e., how many times and
how often do they but or their inclinations toward a product or service), location, price, or promotion.
2. Mystery of shopping. This is a common practice or service businesses today where the researcher pretends he or
she is a customer of his or her own business or the competitor’s. this is a test to determine the quality of the
customer service or if the service provider is doing the right job.
Application to a laundry business: the human observer will bring his or her laundry bag to a competitor and
validate if the service provider piece counts the clothes and if the same will be delivered completely.
Examples of machine observation:
1. Video camera or closed-circuit television or (CCTV). Theses are positioned within the business premises. They
record the customers in their organic shopping or service behaviour(e.g., How they examine the products, how
they interact with the service personnel).
Application to a gym business: the machine observer (the video camera) will record the behaviour of gym members as to
which the gym equipment is used more often. The objective is to understand if there is queuing for a specific kind of
equipment and what time does the queuing happen. This will help the gym owner o decide if there is a need to more
gym equipment or remove the equipment not being used often.
2. Traffic counters: these are very common machine observers used by researchers to determine foot traffic or vehicular
traffic in a particular location. On the marketing side, the researcher will be able to determine where to sensibly install a
tarpaulin, signage, or billboard, as these customer give a glimpse of how many people or vehicles pass the area. Theses
also provide the researcher an idea where to find a strategic location for the business.
Application to a convenience store business: the traffic counter needs to determine how many people pass by the area to
determine if the entrepreneur can meet sales targets.
3. Web analytic. This is an online tool that tracks the performance of a website as to the number of its visitors, the
contents they usually access, and other information relevant to the Web site owner such as geographical locations of the
visitors and statistics on how long they stayed in the web site. This gives the online entrepreneur a report on how his or
her web sites performs and how this drives awareness and sales for the business.
Application to online buy-and-sell business: the researcher will use web analytics to track how many visitors click on the
features of the web site, the content they usually access, to improve on, and analyse the factors that lead them to buy
the products.
4. Barcode scanners. These machines help researchers understand the purchase behaviour of the customer by reading
the product codes and generate relevant sales information.
Application to a supermarket business: a barcode scanner is usually being used by groceries or convenience stores and
supermarkets to analyse the customers’ purchase behaviour and inclinations. Through the information gathered by
barcode scanners, business owners will be able to understand what customers buy, how many times they buy, and how
much do they buy.
5. GPS technology. This technology allows tracking of vehicles and pedestrians exposed to out-of-home advertisements.
Applications to a fast food restaurant: owners of fast food restaurants will be able to determine where to strategically
position their tall signage so that it will be seen by more passing vehicles and pedestrians.
Despite the advantages of observation, it only provides the researcher a façade of what he or she sees or watches and
does not let the researcher necessarily know the feelings of customers. It is only limited to extrinsic behaviors, thereby
not capturing the intrintics ones such as beliefs, inclinations, and stimuli of customers. In a sense, it also becomes
unethical at times, because the researcher directly observes the subject(s) without asking for their permission.
Observation only becomes a relevant research tool if it meets the following conditions:
1. If the person, object, or event is indeed observable. There are instances when observation is not applicable or not
practical to use. For example, a cellphone load entrepreneur will not be able to observe how many times in a
day a customer calls or sends text messages because that customer for sure does not want to be disturbed.
2. If the person does the activity regularly or the event happens on a regular basis. Observation is useful for a
street food business if the entrepreneur notes that his or her customers always buy his/her products every 4pm
and in groups. From here, he or she can already start cooking these street food items before 4pm
3. If doing an interview or FDG is becoming intrusive of the privacy of the person. Instead of asking customers how
many times in a day they brush their teeth, it may be better if the entrepreneur just observes how many times in
a week do they buy toothpaste and in what variant (e.g., per sachet, per box)
4. If the subject of observation does not take too long to produce relevant information. It would be practical to
observe how a customer decides and orders a beverage rather than a customer buying a car because the former
requires little time because he will drink anyway, whereas the latter requires prepurchase tasks such as
researching on the features and price, looking for a bank to finance the loan, and so on.
Traditional and online surveys

When it comes to quantitative research, taking surveys is essential. It is the process of getting answers
from a sample of respondents derived from a particular population. ( you can also survey the whole population
if needed. ) Depending on the objective of the survey, the respondents will be given a questionnaire asking
about their awareness level (e.g., no idea, has little idea, or familiar), their profile, preferences, and behaviors.
These questionnaire can be distributed and answered verbally, by writing , or through the internet

A survey is a very simple and practical to run because it requires preparation of predetermined
questions answerable by definite responses using equitable scales. This is advantageous to the researcher
because not only is it systematized and easier to analyze, but their also a definitive quantitative result to be
interpreted.

Some of the traditional ways to conduct a survey are via telephone, face-to-face interaction, or snail
mail. The emerging and more efficient way of conducting a survey is through the internet-through e-mails, Web
sites, or social media sites. It is more efficient because the results can be derived in real-time depending on the
availability of the respondents. Also, it will not require the researcher to travel physically or spend on telephone
calls or mails.

In preparation for the survey, the researcher must identify what sampling technique to follow, the number of
respondents to be surveyed, and the blueprint of the questionnaire.

1. Sampling techniques. A sample is a percentage of a specific population carefully chosen by the researcher to
generally represent the whole population. When the entire population is relatively small, the researcher may
 choose to include the whole population in the research project. This method is called census. However, most of
the time, the entire population is too large for the researcher to cover. Thus, there is a need for sampling
process.

Sampling techniques include probability and nonprobability sampling. Probability sampling is a

technique wherein samples are given equitable chances or nonzero chances of being selected from a
population. The researcher needs to apply randomization, wherein he/she needs to assure that every sample
has an equal representation for the selection process to be unbiased. The advantage of probability sampling is
that sample error can be quantified. Sampling error is a range of inaccuracy to which a sample might vary from
the particular population. Sampling error is always reflected in the research results inferred from the population.

Nonprobability sampling, on the other hand, does not give the samples equal chances of being selected,
because samples are instead selected according to their accessibility or personal choices of the researcher.
Therefore, the scale of error where the sample deviates from the population for nonprobability sampling is
unidentified. In short, results of nonprobability sampling do not generalize the population chosen.

2. Sample size. The researcher must be able to calculate first the appropriate sample size in conducting the
survey; otherwise, if the sample size that is too large, he/she will waste his/her capital and time, whereas a
sample size that is too small will lead to imprecise results. Therefore, the sample size must be the right size.

3. Questionnaire blueprint. Here re some tips on how to create a blueprint for the questionnaire.

a. Be specific and direct with the question and the answer required.

b. Be flexible with the respondents’ convenient way of answering the questionnaires ( mail, telephone, face-to-
face, or online). Therefore, the researcher must be ready with any of these four formats.

c. Ensure that each question is necessary and not repetitive.

d. Always put yourself in the shoes of your respondents. The questionnaire should be simple but should also meet
the objectives. The composition and type of questions (multiple choice, dichotomous, open-ended) should also
be geared toward their convenience.

e. Make sure that questions are arranged in a coherent order that will lead to answers required. At the onset,
qualifying questions are positioned, followed by general questions, and then specific questions.

f. The questionnaire should look professional, be divided into strategic parts, and be properly numbered.

The marketing mix: the 7Ps of marketing

The marketing mix is a widely accepted strategic marketing tool that combines the original 4Ps (product,
place, price, promotion) with the additional 3Ps – people, packaging, and process – in formulating marketing
tactics for a product or service. These 7Ps are employed until the entrepreneur finds the right combination that
will most effectively serve the customer’s needs and wants and at the same time achieve the profitability
objective.

The 7Ps are controllable by the entrepreneur and therefore must be well thought of to be successful.
Prior the 7Ps, the 4Ps were used in the marketing products or physical goods only. However, these are not
completely applicable to marketing services; thus, the other 3Ps, which are also applicable in marketing
products, were introduced. Only very few products are pure products and only few services are pure services.
Therefore, the marketing mix will be able to address marketing components of both goods and services or even
the hybrids.

Entrepreneurs must use the 7Ps model to do following: conduct a situation analysis; set objectives;
conduct a strength, weakness, opportunity, and threat (SWOT) or competitive analysis; and ultimately come up
 with marketing strategies and tactics. A challenge to a budding entrepreneur is to ask the following key
questions at the onset:

• Product – What product or service is the most appropriate for the opportunity, and why will customers buy or
avail them?

• Place – What location is best suited for business where there are more potential customers? Can they
conveniently transact on-site or online? How is the process of distribution of products or performance of
services?

• Price- What is the most appropriate price, and what pricing strategies will be used for the target customers?

• Promotion – What is the most effective advertisement or combination of advertisements, and which advertising
tool should be used to drive awareness and increase sales?

• People – What type of people needed to be hired? What are the basic skills needed for the job? What leadership
style will be applied by the entrepreneur?

• Packaging – What is the best packaging for product that is attractive enough to customers and cost-efficient at
the same time? What physical evidence does the entrepreneur need to set up so as to sell the service?

• Processing – What is the most compelling feature of the product or the business that will make a difference in
the lives of the customers? What sets the product or service from the rest?

Product

A product is any physical good, service, or idea that is created by an entrepreneur or na innovator in
serving the needs of the customers and addressing their existing problems. As discussed in module 2,an
entrepreneur must first scan the environment, find a compelling problem, and creative a persuasive product or
service out of the opportunity . The product or service should not be created before finding the right customers,
because this is very risky and the resources and time might be put to waste. The three-level concept of product
or services summarizes the reasons that a customer decides to buy a product or avail of a service.

Level 1: core benefits of the product or service

The core benefits of a product or service are the major factors why a customers buys a product or avails
of a service. For example, a customer buys coffee because he/she wants to feel energetic and alert the whole
day.

Level 2: Physical characteristics of the product or service

Once the core benefit has been satisfied and options are available to the customers, the tendency is to
look for the second layer of selection, i.e., which has a better packaging for products or a better physical
evidence or customer experience for services. In the previous example, the customer can choose a coffee with a
more appealing packaging or a more aromatic smell.

Level 3: Augmented benefits of a product or service

Augmented benefits are only additional benefits. However, in case of common products and services
where there are a number of competitors, the differentiator comes from the physical characteristics or physical
evidence, the customer experience, or the augmented benefits. Therefore, the entrepreneurs must provide
customers with augmented benefits that distinguish them from the competitors. In the previous, the customers
can choose a coffee product that comes with a loyalty card, so that when he/she accumulates, say, 10 coffee
drinks, he/she will be able t get a free coffee drink.

Place
 The place refers to a location or the medium of transaction. A strategic location depends on the nature
of the business and the primary target market. In a physical location, the entrepreneur must research about the
area’s population, the traffic, the people’s common paths, their buying behaviour, and their preferences for the
location( e.g., Wi-Fi access, spacious area for parking). In a cyber location, the entrepreneur must use Web
analytics data to understand Web site performance ( e.g., number of visitors, duration of their stay on the Web
site, or the frequently visited contents).

Place

The place refers to a location or the medium transaction. A strategic location depends on the nature of
the business and the primary target market. In a physical location, the entrepreneur must research about the
area’s population, the traffic, the people’s common paths, their buying behaviour, and their preferences for the
location (e.g., Wi-Fi access, spacious area for parking). In a cyber location, the entrepreneur must use Web
analytics data to understand web site performance (e.g., number of visitors, duration of their stay on the web
site, or the frequently visited contents).

Place also covers the product distribution and the whole product logistics. The logistics side for products
should cover production, ordering and receiving raw materials or finished goods from the suppliers, storage,
reorder points, and transportation systems. The logistics side for services covers the physical evidence or
servicescape, service providers, and service delivery process, as well as policies and procedures of the business.

One of the major objectives of the entrepreneur for place is to provide customers with pleasant
experience in buying the product or availing of the service so that they will keep on coming back whether on-site
or online. The entrepreneur should place the product or service depending on the needs of the customers and
on where the profits will be maximized. The entrepreneur should also have a reliable supplier for the
distributions of products or services. The place, whether on-site or online, should also be presentable, appealing
and catchy.

The entrepreneur must devise a set of criteria of choosing the right location aligned with certain objectives, such
as suitability to the target market, condition of the neighbourhood, potential of the area for future
developments, laws and regulations in the area, direct and indirect competitors, foot traffic, and cost of doing
business.

Price

Price is the peso value that the entrepreneur assigns to a certain product or service after considering its
costs, competitions, objectives, positioning, and target market. It is only P in the 7ps that generates revenue for
the business. Here are the most common pricing strategies.

1. Bundling- this refers to two or more products or services in one reduced price (e.g., 3-in-1 coffee for ₱8.00,
manicure and pedicure for only ₱150).

2. Penetration pricing- this refers to setting low prices to increase the price once the desired market share is
achieved (e.g., mobile app-based transportation service offering reduced booking fee of ₱15 as its introductory
price).

3. Skimming- this is the opposite of penetration pricing where prices are initially high and then they are lowered
to offer the product or service to a winder market (e.g., a real estate company offering top-tier projects is now
offering low cost housing of same quality to serve the middle market segment).

4. Competitive pricing- this refers to brenchmarking prices with the competitors (e.g., milk tea prices are
competitively price)

5. Product line pricing- this refers to pricing different products or services within a parallel product array using
varying price points (e.g., LED TV is more expensive than the LCD TV even if under the same brand).
 6. Psychological pricing- this considers the psychology and positioning of the price in the market (e.g., price of
haircut service is at ₱199 because consumers tend to think that odd prices are considerably lower than what
they are; in this example, they tend to round off the price ₱100 instead of ₱200).

7. Premium pricing- this refers to setting a very high price to reflect elitism and superiority (e.g., prices of
signature clothes, bags, perfume).

8. Optional pricing- this refers to adding an extra product or service on the top of the original to generate more
revenue (e.g., meals on top of the air fare).

9. Cost-based pricing- the basis of markup is the cost of sales. For example, the entrepreneur will compute the
cost of coconut juice by adding the cost of the coconut juice (₱10) and the plastic container (₱4). He or she can
set the price at ₱20 to earn ₱6 per coconut juice,

10. Cost plus pricing- the markup is based on a certain percentage of cost (e.g., the entrepreneur wants to set a
50% markup on the coconut juice cost which is ₱14 x 50% = ₱7; the new price is ₱14+₱7=₱21).

The profit of n entrepreneur can be determined only if there is a proper computation of costs associated with
the product or service. There are two classification of costs.

1. Variable costs or controllable cost- these cost are directly proportional to number of products manufactured or
the number or services performed. For example, one of the variable costs involved in a car wash business is the
cost of cleaning materials. The business will incur lower costs where there are few customers.

2. Fixed costs or uncontrollable cost- theses are costs not directly proportional to the manufacturing of a product
or to the performance of the service. Theses are usually the cost of equipment, employee remuneration, rental
cost, and utilities. Theses are considered fixed cost because the business will still incur these costs whether or
not they provide less or more. Therefore, if the entrepreneur produces more products and performs more
services, his or her fixed costs per unit will be lower because the fixed cost will be allocated to the number of
units produced or number of services performed (Sim, 2009)

The entrepreneur must follow these general pricing guidelines to make the business sustainable and
thriving:

1. Do not price the product or service below its cost.

2. Monitor competitors’ prices, and ensure that your prices are at par with them unless the product or service is
really way superior for the competitors.

3. Align prices with the other 6ps (product, place, promotion, people, packaging, and processing)

4. Implement price strategies that are relevant to your market segment. For example, tingi (sachet) pricing is
more appropriate in the grassroots locality or barangay.

5. Align prices with your business objectives.

Promotion

Promotion involves presenting the products or services to the public and how this can address the
publics’ needs, wants, problems, or desires. In promotion, the primary target market should be identified
because it will become the main audience. The main goal of promotion is to gain attention.

A strong integrated marketing communication plan (IMC) should be devise to deliver the compelling
messages effectively. Key marketing messages for promotion can be the following: (1) value proposition or
unique selling proposition of the product or service; (2) product or service image; (3) business image; (4)
business values and philosophy. Once the key marketing message is established, the entrepreneur must choose
 the right promotion tools to deliver theses message to the target market. The entrepreneur can choose one or
combination of the following promotional tools:

1. Advertising – this is a type of communication that influences the behaviour of a customer to choose the product
or service of the entrepreneur over the competitors. The objectives of advertising include the following: (1)
informing, educating, and familiarizing the public with the product and service offerings; (2) building a
trustworthy image; and (3) increasing sales. There are so many ways to advertise, but the challenge for the
entrepreneur is to choose which is the most cost-effective and targeted channel to relay the key marketing
message to the target market. The entrepreneur can choose to advertise through the following:

• Television- regular channels, cable TV

• Radio- AM and FM radio

• Internet- e-mails, web sites, blogs, social media, search engines, podcasts

• Mobile phones- text messages, mobile application, mobile internet

• Print- newspapers, magazines, flyers, directories, signages, posters

• Out-of-home- billboards, buses, bus stops, trains, train station, taxis, street advertisement

2. selling- this is the act of trading a product or service of a price or a fee. The entrepreneur must identify the
target customers who were likely but the product or service. Once identified, he or she must do further research
on the target customers to know their profile and behaviour to come up with a convincing way to sell the
product or service. He or she must know how to handle objections through highlighting the product benefits and
directing the customers to their compelling needs or wants. The entrepreneur must know how to close a sale by
leaving a convincing conclusion that will trigger the customer purchase. After such, he/she must monitor the
customer’s satisfaction, which is called the after sales. Depending on the size of the business, the entrepreneur
must decide whether to hire personnel or not. If so, he/she needs to plan for the recruitment and selection,
training, salaries, scope of work, and communication system.

3. Sales promotions- these are short-term promotional gimnicks wherin practical incentives and appealing
activities are incorporated to entice the customers to buy the product or avail of the service. These are called
“below-the-line” promotions. These are normally implemented when an entrepreneur needs to reach a certain
sales quota to either recover investment or achieve better profitability. Successful sales promotions involve time
limit and sense of urgency, as this strategy enables customers to act immediately to avail of the promo. Longer
sales promotions usually result in customers not taking advantage and not acting immediately. Here are
common examples of sales promotions in the Philippines

• Sales discounts or discount coupons

• Raffles
• Contests and games
• Promo items
• Product or service bundles
Trade fairs or exhibits (e.g., wedding expo)
• Sample distribution or free taste/free trials
• Premiums (e.g., free toys for fast food meals)
• Point-of-purchase promotions (e.g., display stands in grocery stores)
• Advertising specialties (e.g., pens, notebook, umbrellas, bags, calendars)
• Rewards (e.g., reward cards)
4.Public relation- these are image-building initiatives of the entrepreneur to make the name of the business
reputable to stakeholders, such as the target customers, governments agencies, business partners, media, and
the public. Unlike advertisements, public relations (PR) do not directly promote products or services. These PR
 strategies affect customers indirectly, but they do influence the stakeholders to build more trust to the business.
This stimulates the stakeholders to write or shape positive news, resulting in more effective marketing
campaigns than regular advertisements. Positive writeups from journals, newspaper, Web sites or social media,
and even word-of-mouth are more credible than traditional advertisements. Examples of PR strategies are as
follows:
• Press conferences
• Launching events
• Strong media relations through press kits
• Social responsibility events (e.g., charitable or community events)
• Lobbying (e.g., good relations with government officials)
• Web public relations (e.g., blogs, social media, e-mails, word-of-mouth)

People
People is one of the three additional Ps in the marketing mix. In today’s marketing arena, people play a vital
role in servicing customers even through the entrepreneur sells only physical goods. With the influx of various
competing products and services, one of the major differentiators is how people or employees make a difference in the
lives of the customers. It is not just about the quality of products anymore, but how employees serve customers.
Employees have become a major influence in the customer’s buying behavior.
Most of the legwork at the beginning is done by either the entrepreneur or some of his/her family relatives.
Most entrepreneurs only hire people when the business starts to expand. The core job of the business owner is more of
strategy implementation. When the need arises to hire people, he/she must identify the specific, necessary job roles of
employees and their description, so they will be able to know their purpose clearly and serve customers well. These
potential employees also need to be well-compensated and provided with benefits. The entrepreneur must list the
criteria of the following job offers, as well as the requirements such as academic background, job experience, skills or
expertise, attitude, and other documents( e.g., police and NBI clearance)
Packaging
Another addition in the 7Ps is packaging. Packaging is how the product or service is presented to customers. It is
the overall identification (look and feel) of the product or service. This will determine the uniqueness of the product
from competitors. This is the first element that customers see because they don’t know what’s inside yet. Aside from
this, packaging preserves the self life of the product or service. Because of the clamor in ensuring environmental
protection and preservation, many businesses begin to make packages out of environment-friendly materials, not just in
products but also in services.
Packaging’s ultimate goal is to entice customers to purchase the product or services. Thus, the entrepreneur
should focus on pleasing the customers’ eyes. It is not just limited on the product or service alone, but on its totality,
including its accessories, after sales service, and warranty.

Packaging is very important in selling physical products or goods, as it establishes the brand’s identity, as well as
its unique selling proposition. Therefore, elements such as color (which has different meanings on the customer
segment and culture), shape, size, materials, font and text, and graphics must be considered. After establishing the final
packaging, the product must be put into several tests, such as packaging and graphics tests, to ensure that the packaging
is attractive and of high quality.
In selling services, the term servicescape was used to refer to the overall ambiance of the place where the
service is performed. For example, in a spa business, the sevicescape should be cozy, service staff should be friendly, the
massage bed should be comfortable and clean, and relaxing music and the aromatic smell of nature should be evident.
Packaging services often involve bundling to make them look attractive. Examples are tour packages offering hotel
accommodation or a beauty salon having a rebond package with free hair coloring or hot oil treatment.
As one of the additional Ps in the marketing mix, packaging plays a vital role in persuading a customer to try a
product or avail of a service based on what he or she has seen. In fact, packaging sometimes matters more than the
product or service itself. Indeed, it must please the eye of the beholder.
Process
Process is the last addition in the marketing mix as marketers began to realize the importance of the internal or
external operations of the business to serve customer better. Process is define as step-by-step procedure or activity
workflow that the entrepreneur or employees follow effectively and efficiently serve customers. Its components include
input, throughput, and output. The internal process includes the black coffee operations (preprocessing, processing,
postprocessing), wherein employees or machines process customers’ request without necessarily being seen by the
customer. The external process includes the actual servicing where customers are part of the process.
Fundamental of brand management
A brand refers to the identify of a company, of a product, of a service, or of an entrepreneur himself or herself. A
brand is a symbol of promise or assurance from the entrepreneur that what it purports to the customers will happen. A
good brand not just entices customers to try the product but makes them loyal to it. Moreover, the brand sets the image
of the business to the public. The challenge now for the budding entrepreneur is to understand how to craft the brand,
how to market this brand, and how to make this brand deliver. These are the entire messege of the brand management.

Brand management is the supervproduct ision of the tangible and intangable elements of the brand. The tangible
elements include the itself, its packaging, its price, and its location. The intangible elements, on the other hand, include
the perception and relationship of the customers with the brand.
Branding is the process of integrating the strategies formed from the marketing mix to give an identity to
product or service. The goals of branding include the following: (1) establishing to target customers that the business is
reliable and trustworthy and that the product of service is the superior solution to their current problem; (2)
differentiating with competitors; and (3) driving customer loyalty and retention.
With strong branding, customers will feel that they are safer in using the products or availing the service, and
that the risks are minimal or low. If two products will be offered, the customer will likely choose the one from reputable
brand. Promoting the brand is also the same as promoting the product or service. For budding entrepreneurs, choosing
the cheapest and most efficient channels of communication for the brand is the best choice.
One of the emerging but cheaper ways to promote a brand is through social media, because these are platforms
where conversations take place, resulting in “sticky” relationships. The key for the entrepreneur is to manage the
conversations. Handle both good or bad reviews and feedback. Another technique is branding is to observe competitors’
brands (both the successful and not so successful) and analyze their best practices and flaws. The brand should be clear,
simple, catchy, and consistent, so that the target market will have little or no efforts in retaining the business brand to
their minds.

As an important element of a brand, the brand name is major differentiator of the entrepreneur against the
competitors. To be different and catchy, a brand name must possess the following characteristics:
• Unique
• Extendable
• Easy to remember
• Can describe the benefits of the product or service
• Can be converted to other dialects or languages in case the entrepreneur expands to other territories
• Can describe a product category
• Can describe concrete qualities
• Positive and inspiring
The brand is the marketing element that sticks to the mind of the target customers and the public. Therefore,
the entrepreneur must think critically on how to position the brand and be able to sustain it.