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Marketing Mix
areas under the control of the marketing manager
The 4 Ps
Product
Promotion
Price
Place
Product
describes the physical goods, services, and ideas
Physical Goods
tangible- computers, cars, and soft drinks are examples
Services
intangible products- meaning the product cannot be held in your hand- are called services
Ideas
products that can be marketed to specific groups of customers
Three Types of Consumer Products
convenience, shopping, or specialty products
Convenience Product
inexpensive product that a consumer purchases on a regular, routine basis without much thought or effort
Shopping Products
consumers will expand some efforts to compare brands and invest some time to investigate product features and price points
Specialty Product
consumers expend both time and effort to purchase
Installations
major equipment or processes that are complex and expensive
Accessory Equipment
less expensive, less complex equipment purchased more frequently
Raw Materials
most basic materials used by producers
Component Parts
products purchased in finished form from other suppliers
Process Materials
products used in production that become part of the finished product
MRO Supplies
products used in production that do not become part of the finished product
Business Services
processes required in running the business that are often outsourced to other businesses
Product Mix
describes the overall group of products that a business offers and consists of a combination of product items, product categories, and product lines
Product Class
class of the product (i.e., Whirlpool brands).
Product Categories
categories of the product (i.e., refrigerators, cooking, dishwasher, etc.).
Product Lines
different lines of products for a company (i.e., in the dishwashing and cleaning product category: dishwashers, compactors, and disposers).
Product Items
the different items available for each product line (i.e., Whirlpool offers 48 product items)
View of Product Mix
viewed as either being narrow or broad
Broad Product Mix
would be comprised of more product categories that are often less closely related
Deep
comprised of 60 different product items
Shallow
comprised of 3 different product items
Cannibalization
when a business experiences an unintended reduction in sales in of one product due to its introduction of another similar product
Planned Cannibalization
can be part of a growth strategy designed to circumvent a sales decrease due to competitive introductions
New Product Development Process
commonly known process used when companies develop new products
Steps of New Product Development Process
Idea Generation
Screening
Concept Testing
Business Analysis
Product Development
Test Marketing
Commercialization
Brand
totality of that which an organization delivers to its customers
Brand Elements
brand name, logo, slogan, jingle, and packaging style are all examples of brand elements
Brand Name
spoken part of the brand
Brand Mark
symbol or design associated with the brand
Manufacturer's Brand
brands are owned and controlled by a producer
Private Label Brand
brand is owned or controlled by an intermediary, such as a distributor or retailer
Generic Product
to not brand the product at all
Trade Name
identifies the company
Family Brand
a marketing practice involving the use of a single brand name for the sale of two or more related products
Individual Brands
branding strategy in which products are given brand names that are newly created and generally not connected to names of existing brands offered by the company
Functions of a Product's Packaging
-protection of the product during shipping, handling storage, and use
-promotion of the product
Four Characteristics Unique to Services
intangibility
Inseparability
Perishability
Heterogeneity
Intangibility
a service, unlike a good, cannot be held, touched, examined or taken home and put on a shelf for the customer's future use
Inseparability
a service is both produced and consumed at the same time
Perishability
characteristic that describes the fleeting nature of a service
Heterogeneity
services are difficult to standardize
Four Stages of the Product Life Cycle (PLC)
introduction
growth
maturity
decline
Introduction
industry contains few competitors and sales are just beginning to take hold
Growth
customer demand increases, sometimes quite dramatically
Two Stages of Maturity
early and late maturity
Early Maturity
industry sales remain high but growth in industry sales slows
Decline
ultimately, industry sales fall to the point at which it is no longer in the company's best interest to continue to support the product
Promotion
communications arm of marketing. It's a way that a business informs, persuades, and reminds the target market about its product, brands, company, or people
Promotional Mix
optimize the impact of a limited promotional budget
Advertising
placement of announcements and persuasive messages purchased in any form of mass media by businesses who seek to inform and/or persuade members of a target market about their products, services, organizations, or ideas.
Personal Selling
selling that involves a face-to-face interaction with the customer
Sales Promotion
media and non-media marketing pressure applied for a predetermined, limited period of time at the level of consumer, retailer, or wholesaler in order to stimulate trial, increase consumer demand or improve product availability
Public Relations (PR)
form of communication management that seeks to make use of publicity and other non-paid forms of promotion and information to influence the feelings, opinions or beliefs about the company, its products or services, or about the value of the product or service or the activities of the organization to buyers, prospects or other stakeholders
Social Network
a network of social interactions and personal relationships.
Influencer Marketing
use of influencers to increase brand awareness and generate sales has become more popular with the growing power of social media
Pull Promotional Strategy
companies attempt to influence customers to ask for a branded product at their favorite retailer
Push Promotional Strategies
companies build demand within the distribution channel, at the wholesaler or retailer level, by spending promotional dollars on sales calls to the wholesaler or retailer or by offering them quantity discounts
Integrated Marketing Communications
planning process designed to assure that all brand contacts received by a customer or prospect for a product, service, or organization are relevant to that person and consistent over time
Value
what the customer is willing to give up to get the desired benefits
Pricing Objectives
consist of profit maximization, sales maximization, and status quo
Profit Maximization
business may choose a selling price designed to maximize the profit it earns on a product
Sales Maximization
business that pursues a growth strategy is concerned with maximizing sales or market share through pricing
Status Quo
company sets a price at the same level as competitors in the same industry
Cost Structure
imperative that a business understands its underlying cost structure in arriving at a selling price
Demand
desire for certain good or service supported by the capacity to purchase it.
Competition
companies make the pricing decision based on competitors' prices
Marketplace Dynamics
product's price can change over time
Objectives
differing pricing objectives influence price setting
Price Elasticity of Demand
measure of the relationship between a percentage change in the market price of a product and a consequential percentage change in the quantity demanded of a product
Marketing Channel
organized network of agencies and institutions which perform all the functions required to link producers with end customers to accomplish the marketing task (aka distribution channel)
Channel Structure
strategic choice by a business; a producer selects the channel of distribution that helps to best accomplish its marketing objectives.
Direct Channels
indicates that there are fewer intermediaries operating between the producer and the end user
Indirect Channels
imply a larger number of intermediaries and are more commonly seen in consumer markets
Supply Chain Management
encompasses the planning and management of all activities involved in sourcing and procurement, conversion and all logistics management activities
Intensive Distribution
most commonly used for low-priced convenience products that are routinely purchased by customers
Selective Distribution
best employed for highly shopped brands that are considered using limited problem solving
Exclusive Distribution
reserved for specialty products that require extended problem solving to purchase
Channel Relationships
marketing channel consists of separate entities that each have their own objectives and strategies
