Business Test #4

Marketing

The activities involved in getting goods and services from the businesses that produce them to the consumers

Marketings 2 Fundamental Goals

1) to sell what a business makes

2) to manage a brand

Branding

The process of creating an identity for a product or group of products. Is intended to differentiate a company’s product from its competitors

Brand Name

should be distinctive, stand out, and memorable

Logo

A symbol that is associated with the company or product. It can take the following forms:

* Monogram – stylized writing initials
* Abstract symbol – not representative of actual things
* Visual symbol – represents something

Trademark

A word, symbol, design, or a combination of all three that a business uses to distinguish its goods or services from others

Slogan

A short or catchy advertising phrase associated with a company or product

Brand Loyalty vs Brand Insistence

Customers prefer your brand vs a customer is completely loyal and will not accept a substitute

The Product Life Cycle

1) Introduction

2) Growth

3) Maturity

4) Decline

5) Decision Point

Introduction

* Product launch / Introduction into the marketplace


* Low sales
* Consumers are unaware of the product
* Low cash flow
* Selling for early adopters in the hope that they will influence others to buy the product

Growth

* Once early adopters find it others soon try
* Sales increase rapidly
* The market grows,
* Competitors appear
* Products are managed very carefully(advertising to promote brand awareness.)
* At the top of the growth cycle, only a few winners survive.

Maturity

* Growth is flat: neither increases or decreases
* Intense competition
* Brand equity is at its highest
* High profits for those with high market share.
* Weaker competitors will leave the market place
* Competitor based pricing

Decline

* Falling Sales = weaker profits
* May be temporary decline – seasonally driven or new competition
* More competitors leave the market.
* Little spent on marketing the product
* If brand equity drops, the business has a serious problem.

Decision Point

* Whatever brand equity is left is used to reposition the product and make it popular again
* Reformulate, repackage, and reintroduce.
* Introduce the product to a new market
* If decline continues product is removed from the marketplace.

Fads

A product that is extremely popular with a select market for a short time, usually less than a year

Niche

A section of the market in which a product dominates and into which few competitors enter

Seasonal

Some products are popular during a specific time or season. Balancing product quantity with seasonal sales is called inventory management.

The 4 P’s of Marketing

Product Concept (effective marketing)

* Price
* Product
* Place
* Promotion

Product

The development of good products and services considers quality, design, features, and benefits

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\*The Product/Service Mix

A retail store provides services, A service business sells a product. The resulting product/service mix can increase sales to existing customers and attract new ones

Price

* Prices for products must be set with care to ensure their success. Today consumers are very price conscious and look for competitive prices at other stores or on the Internet.

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* Price Sensitivity: The degree to which the price of a product affects consumers purchasing behaviours. The degree of price sensitivity varies from product to product and from consumer to consumer

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* Skim pricing – an approach used by companies that involves keeping the price high and targeting niche buyers
* Penetration pricing – is the opposite of skim pricing. Aim is to keep the price low and focus on reaching the mass market

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Place

The three types of channels of distribution are:

* Direct Channels= Producers, Consumers, ie: Farmers market
* Indirect Channels= Intermediaries – wholesalers, importers, retailers
* Specialty Channels=Vending machines, telemarketing, catalogue, e-commerce etc.

Promotion

* Sales promotion encourages consumers to buy products by using coupons, contests, premiums, samples, or special events

The Two C’s of Marketing

1) Competitive Market

2) Consumer Market

Competitive

All the sellers of a specific product

1) Indirect Competition: Not directly related to each other ie: movies vs pizza

2) Direct Competition: Products that are similar to one another ie: Pizza Nova vs Gino’s Pizza

Consumer

Target Market: the group of consumers that are the potential users of a product or service. These consumers can be identified by demographics and lifestyle

Demographics: the study of obvious characteristics that categorize human beings. Age, Gender, Income, Culture, Family Lifestyle.

Advertising

Good advertisements sell products by making the consumer remember the brand name of their products or services

AIDA

The four standard rules for creating good advertising are summarized as follows:

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1\. Attract Attention – develop a good headline

2\. Interest – make people want to read, watch, or listen

3\. Desire – help the customer want your product

4\. Action – always ask for the sale

Types of Advertisements

* Direct-to-home
* Out-of-home
* Radio
* Television
* Newspapers
* Magazines
* Internet\*

Internet Advertising

1\. Native Advertising: Sponsored ads on FB or “other recommended readings” or “other people liked”.

2. SEM (Search Engine Marketing): Each time an ad is clicked on that links to their website from a search engine.

3\. Display Advertising: Banner Ads and Pop-ups from websites

4\. Mobile Advertising

5\. Social Media: Ads posted on social media apps

6\. Retargeting & Remarketing: Banner ads that appear on websites that you have previously visited.

7\. Email Marketing

8\. Digital Signage: Outdoor ads that are digital with some potential to scan with mobile device 9. Videos Marketing: Ads on YouTube

Market Research

The collection and analysis of information that identifies specific groups of consumers who would use a particular product or service

Types of Marketing Research

* consumer research
* market research
* motivation research
* pricing research
* competitive research
* product research
* advertising research

Market Research Methods

Test marketing • Internal information sources • Surveys • Observation • Focus groups