POB Section 6

Market vs Marketing

Market vs Marketing

A MARKET is any situation where buyers and sellers come into contact,

while MARKETING is the process of identifying, anticipating, and meeting customer needs for profitability.

3 examples of a market

• Street markets

• Supermarkets

• Fish markets

• Bus travel market

• Online electronic marketplaces

• Market for tourists and tourist vendors

• Finance markets

2 Types of Markets and their definitions

Niche Market targets specific groups in the whole market, while Mass Market caters to the whole market.

Segments in a Market

Criteria used to divide the market based on the target audience.

3 trends in markets

Data mining, Integrated Marketing, and Social media are key trends.

E-Tailer

A business that communicates and sells goods to shoppers using the Internet.

What aspects are involved in marketing?

• Identifying: finding out what customers want and their preferences

• Anticipating: predicting future customer requirements.

• Discovering customer requirements: finding out what specific products customers are looking for and the features involved

• Meeting these requirements: responding to customer requirements by giving customers what they want.

• Making a profit: marketing activity will enable a business to predict whether it will make a profit and profit size

Types of Marketing Activities

• finding out about buyers and their buying behaviour

• advertising goods and services in an appealing and accessible way

• distributing a product

• selling (the act of persuading someone to buy).

Market Research

Gathering and analyzing data about a market for goods or services.

Quantitative vs Qualitative Market Research

QUANTITATIVE research can be measured in numbers, getting data from large samples of people, while QUALITATIVE research seeks to expose customers’ views and opinions using open-ended questions, using a small sample of people

Marketing vs Selling

Marketing focuses on finding out and delivering customer needs, while selling persuades customers to buy your product/s.

FACTORS AFFECTING MARKETING ACTIVITY

• Consumer Taste (personal bias) - What consumers are looking for in the products they buy and how their tastes are changing.

• Competition - A company must know competitors' offerings and plans to stay relevant, differentiate itself, and continually provide new & satisfactory products and services

• Consumer behaviour - factors that influence consumers to buy one product over another

Pricing

This involves determining cost levels for products/services, impacting consumer behaviour

Internal Factors Influencing Pricing

• Production cost

• Determining the optimal price for maximizing sales or profits.

• Deciding if a company wants to convey a specific image through its pricing

External Factors Influencing Pricing

• Competitor’s price decisions

• State of the economy

Consumer Behaviour

Factors influencing consumer choices between products and how this behaviour might change over time.

Packaging

Materials used to pack and protect goods, influencing brand image.

Define BRAND and BRANDING

A brand is a unique, consistent and well-recognised image for a product or set of products.

Branding relates to establishing a distinct brand and enables a firm to establish a position in the market.

Brand Image

Set of beliefs that consumers hold about a specific brand.

Sales Promotion & 3 examples

Short-term tools to build brand awareness and motivate purchases.

Includes:

• Free samples

• Offering an additional quantity

• Offering an additional good with a purchase

• Discounts and price reductions

Advertising

Paid communication about goods or services to buyers.

Functions of Advertising

1. Providing information

2. Persuading customers to buy the product

3. Communicating brand identity

4. Generating demand

5. Maintaining customer loyalty

6. Enabling price comparisons

7. Illustrating new trends

Distribution

Movement of goods from source, through a distribution channel, to consumers.

Consumer Panel

Group of people providing advice about products/services for marketing purposes.

Marketing Mix

4 key decisions that must be taken in for the effective marketing of a product.

What are the 4 P’S?

• PRODUCT DESIGN & PERFORMANCE

• PRICE

• PROMOTION

• PLACE

Product

The most important part of the marketing mix, and must meet an identified consumer need

Features of a Product

• Shape

• Design

• Colour

• Size

• Packaging

What is the Product Life Cycle & its stages?

The period over which a product appeals to customers

• Introduction stage: sales growth is slow as only a small amount of people understand its benefits.

• Growth phase: profit begins to increase as more people are exposed to the product and want it.

• Maturity phase: The product is at the maximum purchase stage and may be repeatedly purchased.

• Declining stage: The product is seen as old and sales start to fall

How do you ‘Give New Life’ to a product?

• Modify the Product

• Alter Distribution Patterns

• Change Prices

• Promotional Campaigns

Price

Determining the cost of an item or service based on market attraction.

Place

Decisions on product distribution from manufacturer to final customer.

Channels of Distribution

Brings together an organization and customers to buy and sell goods at a specific place and time.

Organizations in the distribution chain

• Manufacturers

• Wholesalers

• Retailers

Promotion

Spreading information about a product, brand, or company.

4 Main Types of Promotion

advertising, public relations, personal selling, sales promotion

Personal Selling (Type of Promotion)

When members of a sales force are directed to interact with customers to explain a product and how it works, to hopefully make sales

Public Relations (Type of Promotion)

Includes managing information from an organization to its “public” to build the reputation of a company and its brands

WAYS OF PROMOTION

• Coupons

• Loyalty points

• Rebate

• Bundling

• Loss Leader

Social Media Marketing

Form of internet marketing that uses social media sites for marketing activities.

Factors Influencing Consumer Behaviour

• Price

• Price of substitutes

• Quality

• Taste

• Tradition

• Income

• Spending patterns

• Brand loyalty

Purposes of Packaging

• To enable branding of the product

• To provide details of the product

• To protect the product from contamination

• To keep the product fresh

• To make the product more attractive