Business Marketing mix

How is product important to marketing mix?

The product element refers to the products or services the business sells.

A business should conduct market research to find out the needs and wants of its target market.

A business needs its products to stand out from the products of its competitors so that customers buy from it. To do this, a business creates a unique selling point (or USP).

How is price an important element in marketing mix?

Price refers to how much consumers are charged for a product. Price can be set high if customers are willing to pay the high price.

Factors that influence Price

• Amount of competition from other businesses

• customer opinion on the product value

• Brand image

• Availability : short supply < drive up the price

what are different strategies for different types of products: in pricing ?

Price skimming (new products): Price is initially high due to type of product (usually luxury)

Price penetration (new products) Price starts at a lower price to gain market share (attract more customers and raise brand awareness)

How place is an important element in marketing mix?

Place refers to physical location and channels of distribution.

a place also refers to where the customer is able to purchase the product or service. This can include:

• a retail store

• an online store or app

• directly from the manufacturer

What is channels of distribution in (place)

how a product gets from the producer to the consumer.

What are the 4 main channels of distribution?

• Producer –> consumer – this is generally used for small businesses e.g. farm shop

• Producer –> Wholesaler → Consumer (wholesaler buys in bulk and sells to consumers) e.g. furniture

• Producer –> Wholesaler –> Retailer –> Consumer- This is common for clothes

• Producer –> Retailer –> Consumer – this is often used for

electrical products

How promotion is an important element of marketing mix?

Promotion is a range of activities undertaken by the business to make customers aware of its products/services and encourage customers to buy it.

Ex of promotion- 

• offering discounts

• Televison or billboard advertising

• social media/ sponsoring people/ organisations

• test tries

Two types of promotion

Above the line advertising – ATL is used when the focus is on mass media promotion to reach a large audience. ATL includes media such as radio, newspaper and magazines, and billboards.

Below the line advertising – In contrast to ATL, below the line advertising is directed to reach a small, targeted audience. BTL includes marketing activities such as brochures, direct mail, flyers, sponsorships etc.

Type of advertising media is dependent on:

• Cost

• Target audience

• Sponsorship (Individuals, events or teams are sponsored by organizations to increase company recognition and sales)

• Sales Promotions

These are ways to boost sales e.g. BOGOF – buy one get one free, 20% extra free

These are used to boost short term sales

What is promotional mix?

Combination of promotional activities that a business uses to make customers aware of a product with the aim of increasing sales

What makes an effective marketing mix?

• Meets customer needs

• Achieves marketing objectives

• Creates a competitive advantage for the business

Balancing marketing mix based on competitive environment

Businesses that operate in a mass market have a tough competitive environment as there are many other businesses offering very similar products and services. This means that if a business charges too much then its customers will go elsewhere. An example of a business that operates in a mass market is the fast food industry.

How business responds to its competitors?

• changing product price to undercut its competitors (make sure it doesnt result in price war)

• Product differenciation—- designing a product with some unique feature that distinguishes it from similar products sold by competitors.

• Brand loyalty - Customer willingness to buy from particular business than choose competitors

• Changng area or increasing number of places where the product is sold to increase market share.

The impact of changing consumer needs on the marketing mix

Consumer needs change over time – this can be the result of technological improvements or of changes in people’s knowledge and priorities, such as new information about eating healthily. This means a business must adapt its marketing mix to continue to be effective at meeting its customers’ needs.

One common trend is the need for convenience. Businesses have had to alter their marketing mix by developing or adapting new or existing products to suit this consumer need. An example of convenience is a restaurant chain offering ready-made versions of its meals in supermarkets, allowing consumers to eat the food they enjoy, but at home.

What are ways businesses adapt to changing consumer needs?

• Introducing new products to respond to consumer trends,eg releasing smoothies to replace the need for people to eat individual pieces of fruit

• by changing the selling price of products or bringing out budget products to match the state of the economy - eg during a recession, customers will spend less money and businesses may need to reduce their prices to encourage customers to continue to purchase

• opening more small local stores to provide greater convenience to customers

• introducing m-commerce and e-commerce to the business to meet customer expectations

what is one impact of  technology on the marketing mix

Technological advances create many opportunities for businesses. This means that a business’ promotional mix may need to change to enable it to interact with its customers through increasingly popular technologies.

The use of social media has changed how much many businesses spend on traditional promotional activities (eg TV advertising and newspapers) Sponsorship and influencers on social media are commonly used as a means of promoting products and services.(changes due to technology advancements)

Examples of ways businesses may adapt to advances and trends in technology include:

• Increasing use of e-commerce and m-commerce in businesses

• use of digital media to promote products and maintain consumer interest

• Introduction of more competitive pricing because of easy access to price comparisons across retailers