5 5 The Marketing Concept The marketing concept

5. 5 The Marketing Concept The marketing concept is the idea that consumers and competitors should be considered in every important business decision. There are 3 important analytical tools that are used to make sure this idea is a part of product development: Product Mapping Marketing Opportunity Analysis Benefit Analysis

5. 5 The Marketing Concept Product Mapping This occurs when consumers categorize products Example: easy to open, messy, healthy, salty, crispy, soft, sweet, sour, etc. These categories inform marketers on which products to make and what consumers desire Categories of interest where there are not a lot of products areas where new products can be developed

5. 5 The Marketing Concept Marketing Opportunity Analysis Used to define the opportunities or market situations for a particular brand Part 1: The Overall Market Start out by identifying the category the product is in and then identifying all the products in the market If your category is snack foods and then you would need to list every brand of snack food

5. 5 The Marketing Concept Part 2: Indirect Competition Now you should create lists of competitive brands by features, until you have a complete classification of the competitive brands For example, chocolate bars are likely competition for granola bars So chips, chocolate bars, etc. will need to be classified and considered Important to look to see if there are marketing opportunities uncovered at this stage (what gaps are there)

5. 5 The Marketing Concept Part 3: Direct Competition Now you identify all the products that directly compete (products that have the same features) Are there gaps? Places where the market has room for another product? The market potential is calculated with MP = N x P x Q N = number of possible buyers P = purchase price Q = average number of purchases per year

5. 5 Marketing Concept Benefit Analysis This research connects features that consumers want, the value that they ascribe to the feature and what they are willing to pay for the feature This data is used in a cost-benefit analysis where the costs of adding the features to the product are balanced with the possible profit from that change For example, re-sealable packages desirable, but does the customer want to pay extra for it

Great Quiz Question Choose a type of product and perform a Product Mapping or a Marketing Opportunity Analysis. Describe opportunities for product development based on your findings.