Ferrell Hirt Ferrell BUSINESS A CHANGING WORLD EIGHTH

part Marketing: Developing Relationships 5 Chapter 11 Customer-Driven Marketing Chapter 12 Dimensions of Marketing Strategy Chapter 13 Digital Marketing and Social Networking FHF 12 -2

The Marketing Mix Keys to developing effective marketing strategy ü Maintain right marketing mix ü Satisfy target market ü Long-term customer relationships Ø Successful companies have at least one dimension of value that surpasses all others FHF 12 -3

Product [ A good, service, or idea that has tangible and intangible attributes that provide satisfaction and benefit to consumers ] The most visible variable of the marketing mix FHF 12 -4

Developing New Products § § § Idea development New idea screening Business analysis Product development Test marketing Commercialization FHF 12 -5

Classifying Products: Consumer Products Convenience Products § Purchased without doing research into price § Widely available § Often for immediate consumption v Example: A gallon of milk …continued on next page FHF 12 -6

Classifying Products: Consumer Products Shopping Products § Consumer has compared competitors’ prices and has shopped around done § Price, features, quality, style, service and image all influence the decision to buy v Example: clothing, furniture …continued on next page FHF 12 -7

Classifying Products: Consumer Products Specialty Products § Require the greatest level of research and shopping effort § Not willing to accept substitutes § Consumers know exactly what they want and go out of their way to find it § Price not the strongest consideration v Example: designer clothing, art, antiques FHF 12 -8

Classifying Products: Business Products Ø Used directly or indirectly in the operation or manufacturing processes of a business § e. g. , raw materials, mmajor equipment, ccomponent parts FHF 12 -9

Product Line and Product Mix Product Line § Group of closely related products that are treated as a unit because of a similar marketing strategy, production, or end-use Product Mix § All the products offered by the company FHF 12 -10

The Product Life Cycle FHF 12 -11

Identifying Products Branding § The process of identifying products § Name § Term § Symbol § Design Trademark • A brand registered with U. S. patent and trademark office • Protected from use by any other firm FHF 12 -12

Pricing Strategy Four Common Pricing Objectives 1. Maximize profits and sales 2. Boost market share 3. Maintain the status quo 4. Survival FHF 12 -17

Specific Pricing Strategies New Product Pricing § Price skimming § Penetration pricing Psychological Pricing § Even/odd § Symbolic/prestige pricing Price Discounting § Quantity discounts § Seasonal discount § Promotional discounts FHF 12 -18

Distribution Strategies Marketing Channel § A group of organizations that moves products from their producer to consumers Retailers § Buy products from manufacturers and sell them to customers for uses other than resale § Many now compete online Wholesalers § Intermediaries that buy from producers or other wholesalers and sell to retailers § Also called middlemen FHF 12 -19

Distribution Strategy § The least flexible element of marketing mix § Commits resources and establishes contractual relationships § Difficult to change § Expansion into new markets may require new distribution strategy FHF 12 -25

Promotion Strategy § Goal is to communicate with individuals, groups and organizations § Encourages marketing exchanges § Used to influence opinions and attitudes toward organizations, people, or causes FHF 12 -26

The Promotion Mix § § Advertising Personal Selling Publicity Sales Promotion FHF 12 -27

Integrated Marketing Communication [ The process of coordinating the promotion mix elements and synchronizing promotion as a unified effort ] FHF 12 -28

Advertising Ø A paid non-personal communication communicated through mass media § Advertising campaign involves designing a series of advertisements and positioning them to reach a target audience § Online advertising is increasing FHF 12 -29

Personal Selling Ø Direct two-way communication with buyers/potential buyers Avon uses personal selling § Targets women as customers and salespeople § Personal interaction with customers § Salespeople earn commissions § Flexible hours § The internet is an increasingly important component FHF 12 -31

Publicity A non-paid, non-personal communication through mass media channels § Mainly informative or descriptive § News story forms § Can be extremely important for a company FHF 12 -33

Sales Promotion Direct inducements such items as coupons, contests and free samples to persuade buyers to purchase products ü Stimulates customer purchasing ü Enhances other promotional efforts ü Generally less expensive than advertising FHF 12 -34

Promotion Strategies FHF 12 -35