WEEK 8.1 Marketing 4PS

Marketing Plan

Small Business Marketing

• Definition: Business activities that direct the creation, development, and delivery of a bundle of satisfaction from the creator to the targeted user.

• Importance of Marketing: Guides a business towards satisfying customers at a profit.

Marketing Philosophies

1. Product-Oriented

• Focus on the product as the most critical element of the business.

• Questions include: "How can I make this product attractive? What should we add?"

• Approach: "Pulling Customers" with the mindset of building a better mousetrap.

• Consideration: Awareness if customers understand the uniqueness of the product.

2. Sales-Oriented

• Focus on strategies to drive customers to purchase.

• De-emphasizes production efficiencies and customer preferences.

• Approach: "Pushing Product," prioritizing achieving sales goals.

3. Consumer-Oriented

• Emphasizes understanding consumer needs and demands.

• All marketing efforts revolve around the customer, aiming for customer satisfaction as a priority.

Marketing Mix

• Definition: A tool used by entrepreneurs to position products in the target market to effectively deliver benefits to consumers.

Components of Marketing Mix

• Features: Characteristics that define the product.

• Sales Promotion: Tactics to encourage quick sales.

• Quality: The ability of a product to meet customer needs.

• Advertising: Communicating the product’s benefits and information.

• Branding: Establishing a unique image for a product.

• Public Relations: Managing public perception.

Product

• Definition: The offering of a firm that satisfies specific needs.

• Quality: The ability of a product to satisfy customer requirements, focusing on fit for purpose.

• Types of Offerings: Goods, Services, or a combination thereof.

Examples of Products

• Goods: Grocery store, clothing, electronics.

• Services: Shipping, cosmetic surgery, public transport.

Characteristics of Products

• Production location impacts product perception.

• Consistency of quality is vital.

• Services cannot be stored, necessitating direct integration with goods.

• Technological advancements can enhance product value.

Packaging

• Functions: Promotes, protects, and enhances the product.

• Benefits: Can lower distribution costs and increase sustainability through greener practices.

• Regulatory compliance: Adhering to laws about nutritional labeling (e.g., Federal Fair Packaging and Labeling Act).

Warranty Policies

• Definition: Seller promises regarding product performance.

• Service guarantees are common for customer retention (e.g., Pizza Hut's delivery guarantee).

Price

• Factors Influencing Pricing:

  • Competing products' availability

  • Production costs

  • Product types

  • Presence of substitutes

  • Market stage

  • Target consumer demographics.

Pricing Strategies

• Cost-Plus Pricing: Setting a price mark-up on production costs.

• Value-Based Pricing: Pricing based on perceived value to the customer.

• Competitive Pricing: Setting prices relative to competitors.

Place

• Definition: Refers to how products/services reach consumers.

• Multichannel distribution: Utilizing several distribution channels to target the same market effectively.

Promotion

• Definition: Mode of conveying product attributes to consumers.

• Methods of Promotion:

  1. Advertising

  2. Publicity

  3. Personal Selling

  4. Sales Promotion

  5. Direct Marketing

Objectives of Promotions

• Informing: Educating customers about product benefits.

• Persuading: Building favorable attitudes towards the product.

• Reminding: Keeping the product in customers’ minds against competitors.

AIDA Model in Promotions

• A process for organizational buying:

  • Attention: Capturing consumer interest.

  • Interest: Engaging consumers to consider the product.

  • Desire: Generating a longing for the product.

  • Action: Prompting purchase decisions.

Advertising Budget

• Percentage of Sales Method: Allocating advertising budgets based on anticipated sales revenue.