Assignment 221
Delp10
B123-Chapter11-Spring18.pptB123
Chapter 11
Marketing
Marketing
Marketing is concerned with exchange relationships. In commercial (for profit) organizations, products and services are exchanged for money and resources from customers.
- Transactional marketing – oriented towards single purchase
- Relationship Marketing – oriented towards repeat sales.
Transactional marketing Vs Relationship Marketing
Understanding customer behavior
- The traditional model
Understanding customer behavior
- Dimensions of decision making
Segmentation
- It is a process of breaking down a total market into smaller, more distinct segments that have a similar characteristics.
- Two phases of segmentation:
- Understanding the customer and the market
- Indentifying customer characteristics
The marketing mix
- It is a framework developed to help managers to consider all the relevant factors when designing and marketing their products to attract particular segments.
- The 4 (or seven) P’s
- The four C’s
Three level product analysis
- It provides a way of looking at products, and/or services, to analyze key features and benefits.
Features of the three levels:
- Core product / service
- Actual product / service
- Augmented product / service
Branding
- It means creating an identity for a product, associating it with buying not just a product but buying into a lifestyle and certain values.
- Benefits of branding
- A good way of differentiating products.
- Customers can immediately identify specific products
Product life cycle
- It charts the progress of a product in the market from its introduction to its decline.
- The stages in a products growth
- Introduction
- Growth
- Maturity
- Decline
The Boston matrix
- It is intended to contribute to the management of organization’s cash flow.
Using the matrix
- Problem child
- Stars
- Cash cows
- Dogs
Pricing strategies
- pricing policy may well have a powerful effect on an organization's financial viability in the short term, but it is a key element for long-term marketing and corporate strategy.
- Prices need to be set at a level that provide profit.
- Prices must:
Provide the customer with value for money.
Cover the cost.
Be competitive.
Be consistent with company objectives.
Pricing policies
- Penetration pricing: objective is for a new product to establish high volume sales and low production cost, to expand in a new market.
- Marginal pricing: to boost the company’s volume and reduce overall cost, price is below full cost but above variable cost, just for a limited period in special cases.
- Market-based pricing: the product can be priced as the customer is welling to pay according to the market.
- Loss leading: price is below cost to attract initial customers.
- Skimming: charging high price for a short term/
Customer decision and marketing communications
- Marketing communication can be seen as a process of persuasion.
- AIUAPR model
- Awareness, Interest, Understanding, Attitude, Purchase, Repeat purchase.
The communication mix
- A number of tools used by organization to communicate with their audiences. Together these tools are called as the communication mix.
Push & pull strategies
- Companies selling branded products with high level of consumer recognition are likely to focus their communication on advertising to increase the consumer awareness and to create a pull for the products that distributors respond to.
- Companies that are not market leaders, adopt push strategy which involves emphasis on promotional activities aimed at the distributor with the objective of encouraging them to push the product to the consumer.
