Chapter 11 Marketing Function Grade 11+12
Page 1: Marketing Function Overview
Learning Objectives:
Define and elaborate on the 4 traditional Ps of Marketing (Product, Price, Place, Promotion).
Explain the purpose and implications of the Consumer Protection Act (CPA).
Evaluate the role of International Marketing (advantages and disadvantages).
Discuss the use of Technology in Marketing (E-Marketing, social networks).
Link marketing concepts with intellectual property.
Develop and evaluate marketing strategies for goods/services.
Examine the importance of ethical behavior and regulations in marketing.
Role of Marketing
Strategic Role/Aim of Marketing: Essential for business success, influencing revenue and brand loyalty.
Impact of CPA on Marketing: Ensures businesses operate fairly in the market.
Influences on Marketing
Psychological factors (motivation, perception).
Socio-cultural factors (social class, family influence).
Economic factors (income levels, economic conditions).
Branding: Importance of a strong brand, brand extension, brand stretching, and building brand value.
Service Marketing: Focus on people, process, and physical evidence in service delivery.
Ethical Marketing: Understanding ethical vs. unethical marketing practices and the impact on brand image.
Franchising: Advantages and disadvantages for franchisors and franchisees.
Page 2: Table of Contents
Terms and Definitions
The Role of the Marketing Function
Understanding Marketing
Traditional Ps of Marketing
Product
Price
Place
Promotion
Additional Ps: People, Process, Physical Evidence
Advertising
Unethical Marketing Practices
Consumer Protection Act in South Africa
International Marketing Definitions & Evaluations
Factors Influencing Consumer Buying Decisions
Franchising
Bibliography
Page 3: Terms and Definitions
Brand Name: Name given by a producer to a product.
Target Market: Specific group of consumers targeted by marketing efforts.
Pricing Policy: Strategy for setting product prices based on costs, demand, competition.
Costs: Amount required to obtain a product.
Mark-Up: Amount added to costs to cover overhead and profit.
Substitutes: Alternative products serving the same need.
Profit Margin: Portion of selling price contributing to gross profit.
Bait: Tactic to attract customers with low price claims.
Skimming: Setting high initial prices, gradually lowering them.
Monopolistic Competition: Firms react to competitors’ pricing strategies.
Page 4: The Role of the Marketing Function
Understanding Marketing: Activities promoting the sale of products and services. Key for market awareness, customer loyalty.
Indicators of Successful Marketing: Market share increase, customer loyalty, ethical advertising.
Marketing Functions
Identify customer needs and values.
Share customer insights with production teams.
Promote products to potential consumers.
Gather feedback for improvement.
Enhance customer experience.
Page 5: Benefits of Effective Marketing for Businesses
ZABA's Marketing Benefits:
Brand awareness through varied channels.
Targeting appropriate customers with relevant messages.
Excellent service leading to repeat business.
Leveraging digital marketing and competitive pricing.
Page 6: The 4 Traditional Ps of Marketing
Product
Definition: Goods/services offered to satisfy consumer needs.
Considerations:
Quality and features to meet expectations.
Branding for differentiation.
Attractive packaging and lifecycle management.
Product variations catering to market needs.
Example for ZABA: Diverse clothing lines for varied customer needs.
Page 7: Product Development Policy
Importance: Essential for staying competitive and meeting customer demands.
Types of Products:
Industrial Goods: Used in production.
Consumer Goods: E.g., convenience, shopping, specialty, unsought goods, and services.
Page 8: Types of Consumer Goods
Convenience Goods
Characteristics: Low-priced, frequently purchased with minimal effort.
Examples: Bread, soft drinks.
Shopping Goods
Characteristics: Compare prices/qualities, more expensive.
Examples: Clothing, electronics.
Specialty Goods
Characteristics: Unique, specific brand name commitment.
Examples: Branded clothing, jewelry.
Unsought Goods
Characteristics: Not regularly purchased, immediate need.
Examples: Funeral services.
Services
Characteristics: Intangible, provided by service providers.
Examples: Hairdressing, garden services.
Page 9: Importance of Product Development
Key Benefits: Meeting needs, innovation, market expansion, profitability.
Product Design Steps:
Idea generation.
Concept development.
Design and prototyping.
Testing and evaluation.
Product launch.
Page 10: Product Life Cycle (PLC)
Stages:
Introduction: Launch phase with high costs, minimal competition.
Growth: Rapid sales increase, profit margins improve.
Maturity: Market saturation, profit stability.
Decline: Sales decrease, decision on continuation or withdrawal.
Example for ZABA: Management strategies according to PLC stages for clothing lines.
Page 11: Stage Details of Product Life Cycle
Growth Stage
Characteristics: Gaining market acceptance; brand loyalty starts.
Strategies:
Product enhancement based on feedback.
Pricing maintenance to attract more customers.
Maturity Stage
Characteristics: Competition increases, price wars.
Strategies:
Product innovation for new market segments.
Decline Stage
Characteristics: Sales and profits decline.
Strategies:
Product discontinuation or rejuvenation through marketing.
Page 12: Pricing - Definition and Considerations
Definition: Amount paid by customers reflecting product’s perceived value.
Considerations:
Cost analysis, competition, perceived value, discount strategies.
Example for ZABA: Premium vs competitive pricing.
Page 13: Pricing Techniques
Cost-Based Pricing: Based on production costs plus profit margin.
Mark-Up Pricing: Percentage added to cost.
Customer-Based Pricing: Price based on what customers are willing to pay.
Competition-Based Pricing: Aligning prices with competitors.
Promotional Pricing: Temporary price reductions to stimulate demand.
Page 14: Importance of Pricing
Reflects Value: Pricing informs customer value perception.
Factors Influencing Pricing: Input costs, demand fluctuation, market structure.
Page 15: Distribution/Place - Definition and Considerations
Definition: Channels through which products reach consumers.
Considerations:
Selection of distribution channels, supply chain efficacy, retail environment impact.
Page 16: Distribution Policies and Channels
Distribution Policies: Ensure products reach target consumers effectively.
Direct vs. Indirect Channels: Control over marketing vs broader market access.
Page 17: Intermediaries in Distribution
Role of Intermediaries:
Finding buyers, product promotion, expanding market reach, efficient logistics, lower costs.
Page 18: Promotion - Definition and Importance
Definition: Communication strategies to promote products.
Considerations:
Advertising, public relations, sales promotions, personal selling, and social media marketing.
Example for ZABA: Campaigns via social media and fashion shows.
Page 19: Marketing Communication Policy Components
Sales Promotion: Short-term strategies for immediate sales boosts.
Personal Selling: Direct interaction enhancing customer relationships.
Advertising: Paid non-personal communication across various media.
Publicity: Free promotion through media coverage.
Page 20: Additional Ps of Marketing
People
Importance of employee interaction in service delivery and customer satisfaction.
Process
Ensuring efficient service delivery through standardized procedures.
Physical Evidence
Tangible aspects supporting service quality (store atmosphere, product packaging).
Page 21: Advertising Regulations
ARB Role: Ensures advertising upholds ethical standards.
Ethical vs Unethical Marketing Practices
Discusses the importance of maintaining integrity in marketing campaigns.
Page 22: Implications of the Consumer Protection Act (CPA)
Protects consumers from unfair marketing practices, promotes competition, and empowers consumer rights.
Page 23: International Marketing: Definitions and Evaluation
Advantages and Disadvantages of expanding into international markets, focusing on cultural adaptability, political/economic risks, and logistical challenges.
Page 24: Consumer Buying Decision Influences
Psychological Factors: Motivation, perception, learning, beliefs.
Socio-Cultural Factors: Impact of social class and family.
Economic Factors: Consumer purchasing power and economic conditions.
Page 25: Segmentation Methods (LSM)
Living Standards Measure (LSM): Classifies based on living standards, offering insights into targeting strategies.
Other segmentation methods include demographic, psychographic, geographic, behavioral.
Page 26: Branding
Importance of branding, brand extension, brand stretching, and creating brand value.
Page 27: Franchising
Advantages and Disadvantages: Explores benefits of rapid expansion vs quality control issues in franchising.
Page 28: Conclusion
Encourages businesses to adopt various marketing strategies and frameworks to adapt to market changes and consumer expectations.