CHAPTER 4 - Marketing Plan

MARKET DEMAND
MARKET NEED
Market need analysis:
enables you to meet the current needs of
your markets and to anticipate and prepare
for future demands.
reveals risks and opportunities, buying habits,
challenges, and adoption rates while
providing information about those who
evaluate products and make the purchasing
decisions and generating valuable prospect
lists.
By implementing our Market Needs Analysis solution
we can expect to:
Reduce financial risk
Correctly position your products for optimal
performance
Identify your target markets demographic makeup
Identify optimal product and company positioning
Measure the effectiveness of your marketing and
advertising messages
Identify new qualified leads for your sales executives

Niche Market
A focused, targetable portion of a
market
Addressing a need for a product or
service that is not being addressed by
mainstream providers

Why should we bother to
establish a niche market?

**Great advantage of being alone
as service or product provider**

Market Size

The number of buyers and sellers in a particular
market.
Market Size is measured by the total volume and
or value of all sales in the market.
Sales volume is measured in terms of the
number of units of goods purchased, whilst sales
value measures the total amount spent by
customers on the volume of goods sold.
Market Growth
An increase in the demand for a particular
product or service over time.
Market growth can be slow if consumers do
not adopt a high demand or rapid if
consumers find the product or service useful
for the price level.
For example, a new technology might only be
marketable to a small set of consumers, but
as the price of the technology decreases and
its usefulness in every day life increases,
more consumers could increase demand.
Target Market
The specific group of customers that a company aims
to capture.

Group of persons for whom a firm creates and
maintains a product mix that specifically fits the
needs and preferences of that group.

Those who are most likely to buy from the company.

They have been identified as people with needs or
wants that can be met with the products or services
from the company.

Marketing Strategy
It determines the choice of target
market segment, positioning, marketing
mix, and allocation of resources.
Marketing Mix
Process of Marketing Plan

Price Competitiveness

Price lower than that offered by the
competitors.
Or
The same price but more attractive
because of added incentive, such as
longer payment terms.
Pricing Strategies

There are many ways to price a product
1. Premium Pricing.
Use a high price where there is a uniqueness
about the product or service. This approach is
used where a substantial competitive
advantage exists. Such high prices are charge
for luxuries such as Cunard Cruises, Savoy
Hotel rooms, and Concorde flights.
Pricing Strategies
Penetration Pricing.
The price charged for products and
services is set artificially low in order to
gain market share. Once this is
achieved, the price is increased. This
approach was used by France Telecom
and Sky TV.
Pricing Strategies
Economy Pricing.
This is a no frills low price. The cost of
marketing and manufacture are kept at
a minimum. Supermarkets often have
economy brands for soups, spaghetti,
etc.
Pricing Strategy
Price Skimming.
Charge a high price because the company have a
substantial competitive advantage. However, the
advantage is not sustainable.
The high price tends to attract new competitors into
the market, and the price inevitably falls due to
increased supply.
Example:Manufacturers of digital watches used a
skimming approach in the 1970s. Once other
manufacturers were tempted into the market and the
watches were produced at a lower unit cost, other
marketing strategies and pricing approaches are
implemented.
Pricing Strategies
Pricing Strategy
Wall-Mart launch a new range of own-label soups. This is an
economy brand.
Cunard launch two new cruise ships. The service is high price
and high quality with a premium price.
A cable TV provider moves into a new area and needs to
achieve a market share. The company uses a penetration
approach to gain market share. Prices could be increased at a
later date.
Holiday Inns try to fill hotels during winter weekends. This is an
example of 'off peak' pricing.
Burger King introduces a new range of value meals. There is a
lot of price competition in the fast food market, hence the value
approach.
Nokia launch a new videophone. This is a new, innovative
product that can claim a higher price. Skimming is only an
option in the short-term since competition will be inevitable.

Place

Another element of Marketing Mix is
Place. Place is also known as channel,
distribution, or intermediary.
It is the mechanism through which
goods and/or services are moved from
the manufacturer/ service provider to
the user or consumer.
Place
Channels of distribution Industrial Goods

Manufacturer
Manufacturer
Industrial User
Wholesaler
Industrial User
Place
Channels of distribution Consumer Goods

Manufacturer
Manufacturer
Manufacturer
Consumer
Consumer
Consumer
Retailer
Wholesaler
Retailer
Product
Three Levels of a Product:
1. Core
2. Actual
3. Augmented
Product
The CORE product:
NOT the tangible, physical product. We can't
touch it.
The core product is the BENEFIT of the
product that makes it valuable to us. So with
the car example, the benefit is convenience
i.e. the ease at which we can go where we
like, when we want to. Another core benefit is
speed since we can travel around relatively
quickly
Product
The ACTUAL product:
is the tangible, physical product. We
can get some use out of it. Again with
the car example, it is the vehicle that
we test drive, buy and then collect.
Product
The AUGMENTED product:
is the non-physical part of the product.
It usually consists of lots of added value, for
which we may or may not pay a premium.
For example when we buy a car, part of the
augmented product would be the warranty,
the customer service support offered by the
car's manufacture, and any after-sales
service.
Product Positioning Strategy
Positioning is what the customer believes
about our product's value, features, and
benefit
it is a comparison to the other available
alternatives offered by the competition.
These beliefs tend to based on customer
experiences and evidence, rather than
awareness created by advertising or
promotion.
Product Positioning Strategy
Marketers manage product positioning
by focusing their marketing activities on
a positioning strategy. Pricing,
promotion, channels of distribution, and
advertising all are geared to maximize
the chosen positioning strategy.
Promotion
Promotional mix promotion by
marketers that informs, persuades and
reminds potential buyers.
Promotion objectives:
A = AWARENESS
I = INTEREST
D = DESIRE
A = ACTION

Promotion
Promotion includes:
Publicity - any commercial news covered
by media that boosts sales but for which
the company does not pay
Personal selling - personal contact
between sales personnel and potential
customers resulting from sales efforts
Advertising - any sales presentation that is
non personal in nature and is paid
Sales Promotion to stimulate consumer
buying

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MARKET DEMAND

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