Chapter 1:

What is marketing?

Marketing is the process of communicating the value of a product or service to customers, for the purpose of selling the
product or service. It is a critical business function for attracting customers.

Gap in the market

An unmet consumer need or a group of potential customers who are not yet purchasing a good or service. Gaps in
the market represent opportunities for companies to expand their customer base by increasing awareness and creating
targeted offers or advertising campaigns to reach the untapped market. Identification of gaps in the market is an
important step in increasing market share.

There are a number of marketing gaps:

◦Space gap

◦Time gap

◦Information gap

◦Ownership gap

◦Value gap

Marketing activities to bridge the gaps

The gap analysis can be used to analyse gaps in processes and the gap between the existing outcome and the desired
outcome. This step process can be summarised as below:

 Identify the existing process

 Identify the existing outcome
 Identify the desired outcome
 Identify the process to achieve the desired outcome
 Identify Gap, Document the gap
 Develop the means to fill the gap
 Develop and prioritize Requirements to bridge the gap

Market orientation

Production Orientation

Production orientation follows the premise that any product of a high quality can be sold.

From the beginnings of capitalism until the 1950s, it had been assumed that the key requirement of business success
was a product of high technical quality. If a business produced a product that worked well and was durable, the
assumption was that it would have no difficulty selling the product at a profit. This was called the production
orientation, and it was generally true that good products could be sold without effort - encapsulated in the saying "Build
a better mousetrap and the world will beat a path to your door." The production orientation generally held true due to
the growing numbers of affluent and middle-class people that capitalism had created.

Sales Orientation

Sales orientation focuses primarily on the selling and promotion of a particular product.

As opposed to production orientation or product orientation, a firm using a sales orientation focuses primarily on the
selling and promotion of a particular product. The successful management of the relationship between the company and
its customers defines the act of sales or selling. It creates value for customers. Emphasis is not placed on determining
new consumer desires, as such. Consequently, this entails simply selling an already existing product and using promotion
techniques to attain the highest sales possible.

Marketing orientation

A market orientated business starts with the customer, finds out what they want and the produces it for them.

It was claimed that instead of producing products then trying to sell them to the customer, businesses should start with
the customer, find out what they wanted, and then produce it for them. The customer became the driving force behind
all strategic business decisions. The marketing orientation is perhaps the most common orientation used in
contemporary marketing. It involves a firm essentially basing its marketing plans around the marketing concept and,
thus, supplying products to suit new consumer tastes.

Societal marketing orientation

This concept is an enlightened marketing concept that holds that a company should make good marketing decisions by
considering consumers' wants, the company's requirements, and society's long-term interests. It is closely linked with
the principles of corporate social responsibility and of sustainable development.

The societal marketing concept holds that the organization’s task is to determine the needs, wants, and interests of
a target market and to deliver the desired satisfactions more effectively and efficiently than competitors in a way that
preserves or enhances the consumer’s and the society’s well-being. Therefore, marketers must endeavour to satisfy the
needs and wants of their target markets in ways that preserve and enhance the well-being of consumers and society as a
whole. The orientation has an emphasis on social responsibility and suggests that for a company to only focus on
exchange relationship with customers might not be suitable in order to sustain long term success. Rather, marketing
strategy should deliver value to customers in a way that maintains or improves both the consumer's and the society's
well-being.

Here’s the definition of some of the important concepts from the study guide:

 Exchange: The act of obtaining a desired object from someone by offering something of value in return is called
the exchange process.
 Relationship marketing: This is a form of marketing that shifts focus away from sales transactions to emphasize
customer satisfaction.
 Needs and wants: A need is a consumer's desire for a product's or service's specific benefit, whether that be
functional or emotional. A want is the desire for products or services that are not necessary, but which
consumers wish for.
 Value: Value is a customer's perception of relative price (the cost to own and use) and performance (quality) of
a product.
 Intermediaries: An intermediary is a third party that offers an intermediation service between two trading
parties
  Strategic marketing management: The field of marketing strategy considers the total marketing environment
and its impacts on a company or product or service. The emphasis is on "an in depth understanding of the
market environment, particularly the competitors and customers." A marketing strategy differs from a
marketing tactic in that a strategy looks at the longer term view of the products, goods, or services being
marketed.

 What is Marketing?
 Marketing is satisfying customers wants and needs. A Marketing Department in a business will direct the resources of a
company to meet the needs of their customers by planning and developing products / services that are superior value, pricing
the products / services correctly and promoting and distributing them effectively to create exchanges that satisfy not just the
customer needs but the organisational needs as well by ensuring the exchange process is profitable and done more efficiently
that its competitors.

 Explain the Marketing Process

 The Marketing Process is based on two main objectives:
 - Satisfying the needs of their target market
 - Ensuring long term profitability of the organisation
 Bearing this in mind, the organisation needs to ensure the product they are selling satisfies their customers and ensure they
deliver the product to the consumer at the correct place and time. Promotion of products is vital as this communicates
information and messages to the consumers about the company's offering and will hopefully persuade the consumer to
purchase the product should the price be right and in the bracket that the consumer will be willing to pay.

 What does the Marketing Mix consist of?

 The Marketing Mix consists of the 4 P's - product, place, promotions and price

 Question 1
 Marketing orientation arises from the idea that a firm can only achieve goals by determining and satisfying the demands of its
target market more adequately than its rivals can

What does a Marketing Communications Mix Consist of?

Advertising: A paid form of non-personal presentation and promotion of ideas, goods or services by an identified sponsor.
–THE REASON TO BUY–

Sales Promotion: A variety of short-term incentives to encourage trial or purchase of a product or service.
–THE INCENTIVE TO BUY–

Public Relations: A variety of programs designed to promote and/or protect an organization’s image or its individual products.
–THE IDENTIFICATION WITH BUYING–

Personal Selling: Face-to-face interaction with prospective purchasers for the purpose of making presentations, answering questions
and procuring orders.
–THE HIGH TOUCH WAY TO BUY–

Direct Marketing: Use of mail, telephone, email and other non-personal contact tools to communicate directly with or solicit a direct
response from specific customers and prospects.
–THE LOW TOUCH WAY TO BUY–

Publicity: The deliberate attempt to manage the public's perception of a subject. The subjects of publicity include people (for example,
politicians and performing artists), goods and services, organizations of all kinds, and works of art or entertainment.
 Chapter 2:
Macro Environment –

1. The major external and uncontrollable factors that influence an organization's decision making, and affect
its performance and strategies. These factors include the economic factors; demographics; legal, political, and
social conditions; technological changes; and natural forces.

2. Specific examples of macro environment influences include competitors, changes in interest rates, changes in cultural
tastes, disastrous weather, or government regulations.

Micro environment –
Factors or elements in an organization's immediate area of operations that affect its performance and decision-
making freedom. These factors include competitors, customers, distribution channels, suppliers, and the general public.

Market environment-
The collection of non-marketing influences that have an impact on a marketing manager's success in forming and
keeping favorable relationships with desirable customers. The overall market environment for a business is made up of
the macro environment that consists of broader societal influences and the microenvironment which
includes company related influences.

SWOT Analysis

The SWOT analysis is a valuable step in your situational analysis. Assessing your firm’s strengths, weaknesses, market
opportunities, and threats through a SWOT analysis is a very simple process that can offer powerful insight into the
potential and critical issues affecting a venture.

Strengths

Strengths describe the positive attributes, tangible and intangible, internal to your organization. They are within your
control. What do you do well? What resources do you have? What advantages do you have over your competition? You
may want to evaluate your strengths by area, such as marketing, finance, manufacturing, and organizational structure.
Strengths include the positive attributes of the people involved in the business, including their knowledge, backgrounds,
education, credentials, contacts, reputations, or the skills they bring. Strengths also include tangible assets such as
available capital, equipment, credit, established customers, existing channels of distribution, copyrighted materials,
patents, information and processing systems, and other valuable resources within the business. Strengths capture the
positive aspects internal to your business that add value or offer you a competitive advantage.
Weaknesses

Weaknesses are factors that are within your control that detract from your ability to obtain or maintain a competitive
edge. Which areas might you improve? Weaknesses might include lack of expertise, limited resources, lack of access to
skills or technology, inferior service offerings, or the poor location of your business. These are factors that are under
your control, but for a variety of reasons, need improvement to effectively accomplish your marketing objectives.
Weaknesses capture the negative aspects internal to your business that detract from the value you offer, or place you at
a competitive disadvantage. These are areas you need to enhance in order to compete with your best competitor. The
more accurately you identify your weaknesses, the more valuable the SWOT will be for your assessment.

Opportunities

Opportunities assess the external attractive factors that represent the reason for your business to exist and prosper.
These are external to your business. What opportunities exist in your market, or in the environment, from which you
hope to benefit? These opportunities reflect the potential you can realize through implementing your marketing
strategies. Opportunities may be the result of market growth, lifestyle changes, resolution of problems associated with
current situations, positive market perceptions about your business, or the ability to offer greater value that will create a
demand for your services. If it is relevant, place timeframes around the opportunities. Does it represent an ongoing
opportunity, or is it a window of opportunity? How critical is your timing? Opportunities are external to your business. If
you have identified “opportunities” that are internal to the organization and within your control, you will want to classify
them as strengths.

Threats

What factors are potential threats to your business? Threats include factors beyond your control that could place your
marketing strategy, or the business itself, at risk. These are also external – you have no control over them, but you may
benefit by having contingency plans to address them if they should occur. A threat is a challenge created by an
unfavourable trend or development that may lead to deteriorating revenues or profits. Competition – existing or
potential – is always a threat. Other threats may include intolerable price increases by suppliers, governmental
regulation, economic downturns, devastating media or press coverage, a shift in consumer behaviour that reduces your
sales, or the introduction of a “leap-frog” technology that may make your products, equipment, or services obsolete.
What situations might threaten your marketing efforts? Get your worst fears on the table. Part of this list may be
speculative in nature, and still add value to your SWOT analysis.
Explain decision making in the family in terms of family roles and types.

- Family Roles

Initiator - makes suggestions to buy a product and collects the information about the product

Influencer - the person who influences the final decision either explicitly or implicitly such that his/her suggestions are reflected in the
family's decision

Decision maker - makes the final decision and makes the final choice between alternatives

Purchaser - the person who buys the product

The user - This person actually uses the product

Family Types

In husband-dominant families - the husband decides what should be bought

In wife-dominant families - the wife decides what should be bought

In syncratic families - Decisions are usually made jointly by husband and wife

In child-dominant families - the children have a strong influence on family decisions, especially as initiators

What is a SWOT Analysis?

 Chapter 3:
Consumer Behaviour

This is a brief introduction on what consumer behaviour is:

The study of consumers helps firms and organizations improve their marketing strategies by understanding issues such
as how

 The psychology of how consumers think, feel, reason, and select between different alternatives (e.g., brands,
products, and retailers);
 The psychology of how the consumer is influenced by his or her environment (e.g., culture, family, signs, media);
 The behaviour of consumers while shopping or making other marketing decisions;
 Limitations in consumer knowledge or information processing abilities influence decisions and marketing
outcome;
 How consumer motivation and decision strategies differ between products that differ in their level of
importance or interest that they entail for the consumer; and
 How marketers can adapt and improve their marketing campaigns and marketing strategies to more effectively
reach the consumer.

One "official" definition of consumer behaviour is "The study of individuals, groups, or organizations and the processes
they use to select, secure, use, and dispose of products, services, experiences, or ideas to satisfy needs and the impacts
that these processes have on the consumer and society." Although it is not necessary to memorize this definition, it
brings up some useful points:

 Behaviour occurs either for the individual, or in the context of a group (e.g., friends influence what kinds of
clothes a person wears) or an organization (people on the job make decisions as to which products the firm
should use).
 Consumer behaviour involves the use and disposal of products as well as the study of how they are purchased.
Product use is often of great interest to the marketer, because this may influence how a product is best
positioned or how we can encourage increased consumption. Since many environmental problems result from
product disposal (e.g., motor oil being sent into sewage systems to save the recycling fee, or garbage piling up at
landfills) this is also an area of interest.
 Consumer behaviour involves services and ideas as well as tangible products.
 The impact of consumer behaviour on society is also of relevance. For example, aggressive marketing of high fat
foods, or aggressive marketing of easy credit, may have serious repercussions for the national health and
economy.

Phases in the consumer decision making process:

A consumer goes through several stages before purchasing a product or service.

NEED
↓
INFORMATION GATHERING/SEARCH
↓
EVALUATION OF ALTERNATIVES
↓
PURCHASE OF PRODUCT/SERVICE
↓
POST PURCHASE EVALUATION
 1. Step 1 - Need is the most important factor which leads to buying of products and services. Need in fact, is the
catalyst which triggers the buying decision of individuals.

An individual who buys cold drink or a bottle of mineral water identifies his/her need as thirst. However, in such
cases steps such as information search and evaluation of alternatives are generally missing. These two steps are
important when an individual purchases expensive products/services such as laptop, cars, mobile phones and so
on.

2. Step 2 - When an individual recognizes his need for a particular product/service he tries to gather as much
information as he can.

An individual can acquire information through any of the following sources:

§ Personal Sources - He might discuss his need with his friends, family members, co workers and other
acquaintances.
§ Commercial sources - Advertisements, sales people (in Tim’s case it was the store manager), Packaging
of a particular product in many cases prompt individuals to buy the same, Displays (Props,
Mannequins etc)
§ Public sources - Newspaper, Radio, Magazine
§ Experiential sources - Individual’s own experience, prior handling of a particular product (Tim would
definitely purchase a Dell laptop again if he had already used one)

3. Step 3 - The next step is to evaluate the various alternatives available in the market. An individual after
gathering relevant information tries to choose the best option available as per his need, taste and pocket.
4. Step 4 - After going through all the above stages, customer finally purchases the product.
5. Step 5 - The purchase of the product is followed by post purchase evaluation. Post purchase evaluation refers to
a customer’s analysis whether the product was useful to him or not, whether the product fulfilled his need or
not?

Adoption of new products:

5 stage process

1. Product awareness

The first step of the product adoption is to be aware of product. Basically consumers (individual or organizational) are
aware of product introduction in the market via various means of communication, such as television, newspapers,
business magazine, internet etc. People become aware of quality, features, utility, price etc of the product to adopt.

2. Product Interest:

If the awareness or information of the product existence, if consumer is interested in the product he/she starts to collect
the information related to the product. Consumer becomes interested about product quality, features, utility and price.
3. Product Evaluation:

After the collection of the information about the product, the information gathered is evaluated by the consumers.
Consumers checks whether the product quality, features, utility and price of the product satisfactory or not?

4. Product trial:

In the fourth step of the product adoption, consumer makes trial of the product in small amount. They make the use of
the product in small quantity or they may make test use of the product.

5. Product adoption:

After the trial of the product if the consumer is satisfied he/she will adopt the product and use the product regularly
even in the future.

What is consumer bevhavior?

Consumer behaviouris the study of individuals, groups, or organizations and the processes they use to
select, secure, use, and dispose of products, services, experiences, or ideas to satisfy their needs
and wants.

What factors influence consumer behaviour?

 Chapter 4:
Steps in the marketing research process

Step 1. Define the Objective & Your “Problem”

Perhaps the most important step in the market research process is defining the goals of the project. At the core of this is
understanding the root question that needs to be informed by market research. There is typically a key business problem
(or opportunity) that needs to be acted upon, but there is a lack of information to make that decision comfortably; the job
of a market researcher is to inform that decision with solid data. Examples of “business problems” might be “How should
we price this new widget?” or “Which features should we prioritize?”

By understanding the business problem clearly, you’ll be able to keep your research focused and effective.

Step 2. Determine Your “Research Design”

Now that you know your research object, it is time to plan out the type of research that will best obtain the necessary
data. Think of the “research design” as your detailed plan of attack. In this step you will first determine your market
research method (will it be a survey, focus group, etc.?). You will also think through specifics about how you will identify
and choose your sample (who are we going after? where will we find them? how will we incentivize them?, etc.). This is
also the time to plan where you will conduct your research (telephone, in-person, mail, internet, etc.). Once again,
remember to keep the end goal in mind–what will your final report look like? Based on that, you’ll be able to identify the
types of data analysis you’ll be conducting (simple summaries, advanced regression analysis, etc.), which dictates the
structure of questions you’ll be asking.

Your choice of research instrument will be based on the nature of the data you are trying to collect. There are three
classifications to consider:

Step 3. Design & Prepare Your “Research Instrument”

In this step of the market research process, it’s time to design your research tool. If a survey is the most appropriate tool
(as determined in step 2), you’ll begin by writing your questions and designing your questionnaire. If a focus group is your
instrument of choice, you’ll start preparing questions and materials for the moderator. You get the idea. This is the part of
the process where you start executing your plan.

By the way, step 3.5 should be to test your survey instrument with a small group prior to broad deployment. Take your
sample data and get it into a spreadsheet; are there any issues with the data structure? This will allow you to catch
potential problems early, and there are always problems.

Step 4. Collect Your Data

This is the meat and potatoes of your project; the time when you are administering your survey, running your focus
groups, conducting your interviews, implementing your field test, etc. The answers, choices, and observations are all
being collected and recorded, usually in spreadsheet form. Each nugget of information is precious and will be part of the
masterful conclusions you will soon draw.

Step 5. Analyze Your Data

Step 4 (data collection) has drawn to a close and you have heaps of raw data sitting in your lap. If it’s on scraps of paper,
you’ll probably need to get it in spreadsheet form for further analysis. If it’s already in spreadsheet form, it’s time to make
sure you’ve got it structured properly. Once that’s all done, the fun begins. Run summaries with the tools provided in
your software package - build tables and graphs, segment your results by groups that make sense (i.e. age, gender, etc.),
and look for the major trends in your data. Start to formulate the story you will tell.

Step 6. Visualize Your Data and Communicate Results

You’ve spent hours pouring through your raw data, building useful summary tables, charts and graphs. Now is the time to
compile the most meaningful take-aways into a digestible report or presentation. A great way to present the data is to
start with the research objectives and business problem that were identified in step 1. Restate those business questions,
and then present your recommendations based on the data, to address those issues.

When it comes time to presenting your results, remember to present insights, answers and recommendations, not just
charts and tables.

Discuss the steps in the market research process

Steps in the marketing research process

Step 1. Define the Objective & Your “Problem”

Perhaps the most important step in the market research process is defining the goals of the project. At the core of this is
understanding the root question that needs to be informed by market research. There is typically a key business problem
(or opportunity) that needs to be acted upon, but there is a lack of information to make that decision comfortably; the job
of a market researcher is to inform that decision with solid data. Examples of “business problems” might be “How should
we price this new widget?” or “Which features should we prioritize?”

By understanding the business problem clearly, you’ll be able to keep your research focused and effective.

Step 2. Determine Your “Research Design”

Now that you know your research object, it is time to plan out the type of research that will best obtain the necessary
data. Think of the “research design” as your detailed plan of attack. In this step you will first determine your market
research method (will it be a survey, focus group, etc.?). You will also think through specifics about how you will identify
and choose your sample (who are we going after? where will we find them? how will we incentivize them?, etc.). This is
also the time to plan where you will conduct your research (telephone, in-person, mail, internet, etc.). Once again,
remember to keep the end goal in mind–what will your final report look like? Based on that, you’ll be able to identify the
types of data analysis you’ll be conducting (simple summaries, advanced regression analysis, etc.), which dictates the
structure of questions you’ll be asking.

Your choice of research instrument will be based on the nature of the data you are trying to collect. There are three
classifications to consider:

Step 3. Design & Prepare Your “Research Instrument”

In this step of the market research process, it’s time to design your research tool. If a survey is the most appropriate tool
(as determined in step 2), you’ll begin by writing your questions and designing your questionnaire. If a focus group is your
instrument of choice, you’ll start preparing questions and materials for the moderator. You get the idea. This is the part of
the process where you start executing your plan.
By the way, step 3.5 should be to test your survey instrument with a small group prior to broad deployment. Take your
sample data and get it into a spreadsheet; are there any issues with the data structure? This will allow you to catch
potential problems early, and there are always problems.

Step 4. Collect Your Data

This is the meat and potatoes of your project; the time when you are administering your survey, running your focus
groups, conducting your interviews, implementing your field test, etc. The answers, choices, and observations are all
being collected and recorded, usually in spreadsheet form. Each nugget of information is precious and will be part of the
masterful conclusions you will soon draw.

Step 5. Analyze Your Data

Step 4 (data collection) has drawn to a close and you have heaps of raw data sitting in your lap. If it’s on scraps of paper,
you’ll probably need to get it in spreadsheet form for further analysis. If it’s already in spreadsheet form, it’s time to make
sure you’ve got it structured properly. Once that’s all done, the fun begins. Run summaries with the tools provided in
your software package - build tables and graphs, segment your results by groups that make sense (i.e. age, gender, etc.),
and look for the major trends in your data. Start to formulate the story you will tell.

Step 6. Visualize Your Data and Communicate Results

You’ve spent hours pouring through your raw data, building useful summary tables, charts and graphs. Now is the time to
compile the most meaningful take-aways into a digestible report or presentation. A great way to present the data is to
start with the research objectives and business problem that were identified in step 1. Restate those business questions,
and then present your recommendations based on the data, to address those issues.

When it comes time to presenting your results, remember to present insights, answers and recommendations, not just
charts and table
 Chapter 5:
Market Segmentation: The process of splitting customers, or potential customers, in a market into different
groups, or segments, within which customers share a similar level of interest in the same or comparable sets of
needs satisfied by a distinct marketing proposition.

http://www.marketsegmentation.co.uk

Another explanation of market segmentation is:

The process of defining and subdividing a large homogenous market into clearly
identifiable segments having similar needs, wants, or demand characteristics. Its objective is
to design a marketing mix that precisely matches the expectations of customers in the targeted
segment.

Few companies are big enough to supply the needs of an entire market; most
must breakdown the total demand into segments and choose those that the company is best
equipped to handle.

Benefits of market segmentation

Implementing segmentation has many benefits to a company. After segmenting the market, a customer
needs and wants can be identified more effectively, communication with these customers improves,
opportunities for growth and innovation are created and profits and market share increase.

1. Better Satisfy Customer Needs and Wants

2. Better Communication
3. Opportunity for growth
4. Increased Innovation
5. Higher Profits/Market Share

Disadvantages of market segmentation

 It is very expensive – it’s much cheaper to develop one product for one segment than multiple
products for multiple segments
 only limited market coverage - since the communication and other marketing efforts will only
be targeted at the chosen target market
 excessive differentiation of the product - this may eventually lead to cannibalization of the
product, when the new product takes sales away from the existing product

Prerequisites of market segmentation

An effective segment needs to defined, measurable, accessible, actionable and suitable for the firm. These
elements mean that a firm
- has a clearly defined, distinguishable and profitable segment
- has the resources to cater for its segments and
- is able to access its segment, so that it can profit from a segment with growing product sales. If any of these
elements is missing it will hinder the success of the firm and lead to wasted effort.

The criteria for marketing

An ideal market segment meets all of the following criteria:

It is possible to measure.

It must be large enough to earn profit.

It must be stable enough that it does not vanish after some time.

It is possible to reach potential customers via the organization's promotion and distribution
channel.

It is internally homogeneous (potential customers in the same segment prefer the same product
qualities).

It is externally heterogeneous, that is, potential customers from different segments have different
quality preferences.

It responds consistently to a given market stimutarlus.

It can be reached by market intervention in a cost-effective manner.

It is useful in deciding on the marketing mix.

Definition of target market

The consumers a company wants to sell its products and services to, and to whom it directs its
marketing efforts. Identifying the target market is an essential step in the development of a
marketing plan. A target market can be separated from the market as a whole by geography,
buying power and demographics, as well as by psychographics.

Not all products and services are meant for all types of consumers. In fact, companies may
tweak certain aspects of a product, such as the amount of sugar in a soft drink, so that it is
more likely to be purchased by consumers with varying tastes. Creating the target market may
require the use of limited product roll-outs and focus groups, allowing product managers to get a
feel for which aspects of the product are the strongest.
What is market segmentation ??

Market Segmentation: The process of splitting customers, or potential customers, in a market into different
groups, or segments, within which customers share a similar level of interest in the same or comparable sets of
needs satisfied by a distinct marketing proposition.

Another explanation of market segmentation is:

The process of defining and subdividing a large homogenous market into clearly
identifiable segments having similar needs, wants, or demand characteristics. Its objective is
to design a marketing mix that precisely matches the expectations of customers in the targeted
segment.

Few companies are big enough to supply the needs of an entire market; most
must breakdown the total demand into segments and choose those that the company is
best equipped to handle.

Define Target Market

Definition of target market

The consumers a company wants to sell its products and services to, and to whom it
directs its marketing efforts. Identifying the target market is an essential step in the
development of a marketing plan. A target market can be separated from the market as
a whole by geography, buying power and demographics, as well as by psychographics.

Not all products and services are meant for all types of consumers. In fact, companies
may tweak certain aspects of a product, such as the amount of sugar in a soft drink, so
that it is more likely to be purchased by consumers with varying tastes. Creating the
target market may require the use of limited product roll-outs and focus groups,
allowing product managers to get a feel for which aspects of the product are the
strongest.

Chapter 6:
Product: A good or service that most closely meets the requirements of a
particular market and yields enough profit to justify its continued existence. As long as cars are
manufactured, companies that produce tires fill the market need and continue to be profitable.

Product Classification

Product classifications help marketers focus their efforts using consumers’ buying behavior. Your business can use
these buying habits to design your marketing efforts for a clearly defined target audience.

http://yourbusiness.azcentral.com

Tangible Physical Characteristics:

Product can be classified into three group, according to their durability or tangibility as shown below:

a. Non durable goods: Non durable goods are tangible goods that are normally consumed in one or few uses.
Examples are Beer, Toothpaste, Sugar, Soap and Salt. These goods are consumed fast and purchased frequently
by the consumers. Many fast foods fall into this category.

b. Durable Goods: These are tangible goods that normally survive many uses. Goods that fall under this
category include, Furniture, Refrigerator, Clothing, Rug etc. They are not frequently purchased as non-durable
goods because they are used up slowly.

c. Services: These are activities, benefits or satisfaction that are offered for sale.

Examples are Haircuts, Repairs, Banking Services and Dry cleaning. Services are intangible. They are usually
produced and consumed in the same time frame unlike durable goods or non-durable goods that can be
produced and shelved. The producer of goods may be far away from consumers, but service providers often
work in the presence of the customers.

Consumer Products:

Convenience Goods

Those products your customers buy often and without much thought or planning are classified as convenience
goods. Soap, condiments and toothpaste are common examples of convenience goods. Consumers typically
make a choice once on their brand preference for these products and repeat that choice over many purchases.
Making your convenience goods available for impulse or emergency purchases can be particularly effective.
You’ll see this marketing tactic in the placement of candy near the cash register of your grocery store for
impulse buys. Another version is to place umbrellas, boots or snow shovels near a store exit when sudden
weather changes call for them.

Shopping Goods

Buying decisions are detailed considerations of price, quality and value for products classified as shopping
goods. Think about the amount of time you put into picking out a clothing purchase, a car or appliances.
Successful marketing of your shopping goods can come from positioning as a better buy than your competitors -
- for example, presenting better value with higher quality for the price or vice versa. Products in the shopping
goods classification tend to rely on heavy advertising and even trained salespeople to influence consumer
choices.

Specialty Products

Goods in the specialty products classification tend to promote very strong brand identities, often resulting in
strong brand loyalty among consumers. Examples include stereos, computers, cameras and the most high-end
brands of cars and clothing. While used cars are classified as shopping goods, a brand-new Mercedes is
classified as a specialty good. Buyers for your specialty goods generally spend more time seeking the product
they want than on comparing brands or products to make a value decision. Your marketing of specialty goods
can be successful by promoting what you have on hand and where your costumers can find it.

Unsought Goods

The products classified as unsought goods are those that your consumers don’t put much thought into and
generally don’t have compelling impulse to buy. Examples include batteries or life insurance. Your consumers
essentially buy unsought goods when they have to, almost as an inconvenience rather than the newest, latest,
greatest product they can’t wait to purchase. Marketing your unsought goods will likely be most effective with
lots of advertising and salespeople promoting the idea of unresolved need for your unsought products.

Industrial Products:

This classification is based on relationship of the goods to the organisation’s production process and cost
structure. Industrial goods are intermediate goods and can be classified into three categories below:

(a) FOUNDATION GOODS: These are manufacturing machines upon which production is dependent. They are
not used up in the production process but over a course of years during which a part is charge off as
depreciation. Foundation goods are long-term investment.

There are two types of foundation goods: installation and accessory equipment.

i. Installations: These are long - lasting products that are not bought very often. These consist of buildings
and fixed equipment.

(ii) Accessory equipment: These comprise of portable factory equipment and tools. These equipment do not
become part of the finished product. They simply help in the production process.
(b) ENTERING GOODS: These refer to ingredients or components of product.

These are the parts that go into the product itself. Entering goods can also be categorised into two main sub-
groups: raw material and fabricating materials.

(i) Raw materials: These are goods that have been produced only enough to make handling convenient and safe.
They enter the manufacturing process basically in their natural state.

(ii) Fabricating materials: These undergo some degree of initial processing before they enter the product
manufacturing process.

(c) FACILITATING GOODS: These are operating supplies that are used up in the operation of the firm but do
not become part of the product. They are usually budgeted as expenses and have short life. The purpose of such
goods is to keep the foundation goods functioning properly and to help in the handling and supply of the
entering goods. Examples are lubricating oil; saw blades, cider forms and labels.

Product line decisions

A group of products that are closely related because they function in a similar manner are sold to the same customer
groups, are marked through the same types of outlets, or fall within givenprice range”.

For example: Nike products several lines of athletic shoes, Motorola products several lines of
telecommunications products and AT&T offers several lines of long distance telephone services.

A major product line decision involves product line length.

 The number of items in the product line.

 The line is too short if the manager can increase profits by adding items.

 The line is too long if the manager can increase profits by dropping items.

http://www.mbanotesworld.com

Branding

A brand can be defined as a "name, term, sign, symbol or design, or a combination of them intended to identify the
goods and services of one seller or group of sellers and to differentiate them from those of other sellers.

Therefore it makes sense to understand that branding is not about getting your target market to choose you over the
competition, but it is about getting your prospects to see you as the only one that provides a solution to their
problem.

The objectives that a good brand will achieve include:

Delivers the message clearly
Confirms your credibility
Connects your target prospects emotionally
Motivates the buyer
Concretes User Loyalty

To succeed in branding you must understand the needs and wants of your customers and prospects. You do this by
integrating your brand strategies through your company at every point of public contact.

Your brand resides within the hearts and minds of customers, clients, and prospects. It is the sum total of their
experiences and perceptions, some of which you can influence, and some that you cannot.

A strong brand is invaluable as the battle for customers intensifies day by day. It's important to spend time investing
in researching, defining, and building your brand. After all your brand is the source of a promise to your consumer.
It's a foundational piece in your marketing communication and one you do not want to be without.

 A brand is a product, service, or concept that is publicly distinguished from other products,
services, or concepts so that it can be easily communicated and usually marketed.
 A brand name is the name of the distinctive product, service, or concept.
 A brand mark is the aspect or element (such as color, design, picture, symbol, typeface) of a
brand that cannot be expressed in words.
 A trademark is a symbol, word, or words legally registered or established by use as
representing a company or product.
 A copyright is the exclusive and assignable legal right, given to the originator for a fixed
number of years, to print, publish, perform, film, or record literary, artistic, or musical material.

Manufacturer brand: Common practice where a manufacturer markets a good or family of goods under its own
brand name(s). The objective is to attract and retain satisfied-customers whose loyalty may be transferred to the manufacturer’s
other products. For example, many successful clothing designers, operating on this principle, have licensed their manufacturer's brand
name outside the clothing category to include cosmetics, perfumes,and even jewelry.

Generic brand: A type of consumer product that lacks a widely recognized name or logo because it typically isn't advertised.
Generic brands are usually less expensive than brand-name products due to the lack of promotions, which can inflate the cost of a
good or service. Generic brands are designed to be substitutes for more expensive brand-name goods. Generic brands are known for
their trimmed-down packaging, and often plain labels. For example, a supermarket may offer its own generic product next to a name-
brand product in the hope that a cost-conscious customer will select the cheaper substitute.

Family brand: It involves using one brand name to market multiple products. For example, a company may use one brand to
market soap, lotion, hair shampoo, and nail polish. This differs from branding individual products, which involves giving each
product its own name and image. For example, a company may sell lipstick and nail polish, giving each product line a separate
marketing identity.
Packaging

With the increased importance placed on self-service marketing, the role of packaging is becoming quite
significant. For example, in a typical supermarket a shopper passes about 600 items per minute, or one item
every tenth of a second. Thus, the only way to get some consumers to notice the product is through displays,
shelf hangers, tear-off coupon blocks, other point-of-purchase devices, and, last but not least, effective
packages. Considering the importance placed on the package, it is not surprising that a great deal of research is
spent on motivational research, color testing, psychological manipulation, and so forth, in order to ascertain
how the majority of consumers will react to a new package. Based on the results of this research, past
experience, and the current and anticipated decisions of competitors, the marketer will initially determine the
primary role of the package relative to the product.

Types of packaging:

Family packaging: This means that products in the same brand have a similar type of visual packaging. This
helps consumers recognize the products on the shelf, and also helps them to quickly assign characteristics to
each product based on previous experience of the brand. Elements of the family packaging, such as color and
pattern, are generally carefully chosen by packaging designers to make the products as appealing as possible to
potential customers.

Special packaging: Packaging that has been made for specific use of a particular item.

Reusable packaging: Packaging that can be used more than once.

Multiple packaging: Multiple packaging is one of the best, quickest and easiest ways to increase volume sales
for your product. When consumers buy in multiples in convenient paperboard carriers, they will consume more
product, faster, at home and return to replenish it sooner. Bottom line, your sales and profitability increase

Kaleidoscopic packaging: This is when packaging continually changes to reflect a series/ particular theme. An
example World Cup soccer or rugby pictures on cold drink cans.

Types of new products:

1. New-to-the-world: This category is for those products that have just been invented. No one knows how they work. So knowledge
customers. And once they start getting
about what they do and how they are used must be imparted to potential
buyers, they give birth to new markets and thus companies producing them get to enjoy the first
mover advantage.

2. New-to-the-marketer: Sometimes companies wish to produce products that are new to them, but old to the customers. The
markets already exist and the companies through the products just need to enter into them.

3. Line extensions: It is very common for big companies often embark on creating products to add to the existing product lines.
There are many reasons behind this. But the ultimate one is profit.
4. Improved products: Companies wishing to offer the best to customers often restudy their products so every bit of them gives the
best service. Such products are categorized as improved and revised. It is usually seen this category is used by companies specializing
in electronic and makeup products.

5. Repositioned products: Many existing products often end up being valuable for other usage. When companies realize it they
reintroduce them to the customers by emphasizing this other usage. This is basically known as repositioning.

Factors influencing the adoption process

Differences in peoples readiness to try a new product

Categorisation of individuals:

 Innovators: venturesome - very eager to try new ideas

 Early adopters: opinion leader, respect from their peers, person to check with before purchasing
 Early majority: Deliberate - adopt ideas later than average time
 Late majority: Skeptical, purchase because of economical necessity
 Laggards: traditional, last person to adopt an innovation

What are the factors influencing the adoption process of new products?

Differences in peoples readiness to try a new product

Categorisation of individuals:

 Innovators: venturesome - very eager to try new ideas

 Early adopters: opinion leader, respect from their peers, person to check with before purchasing
 Early majority: Deliberate - adopt ideas later than average time
 Late majority: Skeptical, purchase because of economical necessity
 Laggards: traditional, last person to adopt an innovation

What is a product?

Product: A good or service that most closely meets the requirements of a

particular market and yields enough profit to justify its continued existence. As long as cars are
manufactured, companies that produce tires fill the market need and continue to be profitable.

Chapter 7:
Defining Pricing:

Pricing is the process of determining what a company will receive in exchange for its product.

 Market Price is the economic price for which a good or service is offered in the marketplace.
 Target Price is the price at which a seller projects that a buyer will buy a product.
 Selling Price is the market value, or agreed exchange value, that will purchase a definite quantity,
weight, or other measure of a good or service.

Price Setting Process

As an entrepreneur, setting a pricing strategy and policy for your products/services for the first time when you
develop it or when you introduce your product / service into a new geographical area, can be a big head
ache.Reason being, that price is not just a tag on the product or service, it communicates to your customers your
business’s intended value positioning and also determines your profitability.

Define pricing.

Pricing is the process of determining what a company will receive in exchange for its product.

What is the following:

 Market Price
 Target Price
 Selling Price

 Market Price is the economic price for which a good or service is offered in the marketplace.

 Target Price is the price at which a seller projects that a buyer will buy a product.

 Selling Price is the market value, or agreed exchange value, that will purchase a definite quantity, weight, or other
measure of a good or service.

Chapter 8:
Please Discuss "publicity" in terms of the marketing communications function.

There are several definitions of publicity, but the most appropriate one is the one that is from a
marketing angle. Publicity in its simplest form is the means of conveying information to the general
public through the media. The information being publicized could be news, awareness about a product
and service, etc. It is the process of creating awareness of new products and services.
Depending on the type of product or service being publicized, certain categories of people may be
the target audience.
For instance, if the product is for babies, nursing mothers, and pregnant women will likely be the target
audience. Publicity is a marketing vehicle. Other marketing vehicles are sales promotion, direct
marketing, and advertising. Some scholars are of the opinion that advertisements should not be seen as
another element of marketing, as publicity of any product is an advertisement on its own.
Means of getting publicity are through print media (newspapers, journals, magazines, etc.); television;
radio; email; websites; and social media like Facebook, Twitter, and blogs. Other means of publicity
are public speech, seminars, and workshops.
The means of publicity to adopt usually depends on the kind of information to be publicized, financial
resources and target audience. Identifying publicity is quite easy. Anytime any piece of information is
being disseminated to the public through any of the media listed above, it implies that a form of
publicity has taken place.
Publicity has only one purpose – to get certain information across to as many people as possible within
the shortest time frame. For you to record any sale on your products or services, your prospects have to
be aware of those products and services, and they also have to know the attached benefits.
Suffice it to say that the number of sales is directly dependent on the number of people who got to
know about the product.
Publicity is communication and communication is a two-way transaction. Publicity is not complete
without getting feedback from the recipients of the required information. So, another part of publicity is
providing means or platform for sending feedback or any other form of response from those who got
the message being disseminated.
Different Types of Publicity
In this digital age, there are two major types of publicity – offline publicity and online publicity.
Offline publicity is done without the internet. Offline publicity includes print media (magazines,
journals, newsletters, daily newspapers, postcards, bills and fliers); television; radio; and giant
billboards.
On the other hand, online publicity is the one done through any internet-based platform. Some online
publicity techniques are email marketing, web page pop-ups, blogs, websites, Facebook publicity,
Twitter publicity and referral links/ad banners.
One thing that makes publicity successful is traffic. While offline publicity is meant for offline traffic,
online publicity is also meant for online traffic.
Regular traffic is key to publicity and advertisement. This is why several billboards are displayed in a
stadium only when there will be a match in that stadium.
In conclusion, publicity is an inevitable part of marketing. No matter how good your product is,
without effective publicity, you will just be “winking in the dark."

Why is Publicity Important?

Publicity helps businesses build credibility and brand awareness. It's a cost-effective strategy, but only
 if you create newsworthy stories. Publicity stories have to be interesting, timely and relevant. Boring
stories that have no merit will take you nowhere and could have a detrimental fact on your business by
causing people to lose interest and stop listening. Effective publicity goes beyond news releases and
while news releases can help with search engine marketing, you'll need a bigger and more
strategic public relations program to get you the results that you desire.

Six Core Benefits of Publicity

 Publicity can be hard to secure but if you can publicity brings along with it several benefits including -
 Publicity is the low-cost or no-cost option.
 Publicity positions your business and the principals of that businesses as experts in your industry.
 Publicity helps your business to stand out and be noticed.
 Publicity can help in the development of partnerships and strategic alliances.
 Publicity builds your credibility and propels you into a competitive position

Discuss the Marketing Communications Mix...

Marketing Communications Mix

Advertising: A paid form of non-personal presentation and promotion of ideas, goods or services by an
identified sponsor.
–THE REASON TO BUY–

Sales Promotion: A variety of short-term incentives to encourage trial or purchase of a product or service.
–THE INCENTIVE TO BUY–

Public Relations: A variety of programs designed to promote and/or protect an organization’s image or its
individual products.
–THE IDENTIFICATION WITH BUYING–

Personal Selling: Face-to-face interaction with prospective purchasers for the purpose of making
presentations, answering questions and procuring orders.
–THE HIGH TOUCH WAY TO BUY–

Direct Marketing: Use of mail, telephone, email and other non-personal contact tools to communicate directly
with or solicit a direct response from specific customers and prospects.
–THE LOW TOUCH WAY TO BUY–

Publicity: The deliberate attempt to manage the public's perception of a subject. The subjects of publicity
include people (for example, politicians and performing artists), goods and services, organizations of all kinds,
and works of art or entertainment.

Chapter 9:
 What are the tree types of channel management conflict??

1. Vertical Channel Conflict: Vertical channel conflict arises when manufacturer tries to sell on their own while still maintaining
working relationships with third-party retailers and distributors. This leads to competition for sales where retailers and
distributors often get lower profits for selling the same product or service as the manufacturer is selling. Since it is
primarily the retailers and distributors role to build awareness of the product, this can lead to an overall decrease in sales.
This situation is called a vertical channel conflict because it affects two different levels of business, third-party sales and
bottom-line sales.

2. Horizontal Channel Conflict: In this type of channel conflict, a manufacturer not using third-party retailers faces a struggle
between two of its own sales divisions, such as its online and offline departments. Usually one division starts to cut into
the sales and profit of the other division, devaluing the latter. Horizontal channel conflicts occur between two departments
on the same level of importance

3. Multi Channel Conflict: Multilevel channel conflicts arise when a manufacturer creates competition between its own sales
and promotion arms, while also having business relationships with third-party retailers and distributors. The reason for this
approach may be to aggressively and more quickly expand its sales and promotion network, but it can create both internal
and external discord between the various divisions and third-parties.

Channel Design

1. Intensive Distribution: the producer's products are stocked in the majority of outlets. This strategy is
common for basic supplies, snack foods, magazines and soft drink beverages.
2. Selective Distribution: means that the producer relies on a few intermediaries to carry their product. This
strategy is commonly observed for more specialised goods that are carried through specialist dealers, for
example, brands of craft tools, or large appliances.
3. Exclusive Distribution: means that the producer selects only very few intermediaries. Exclusive
distribution is often characterised by exclusive dealing where the reseller carries only that producer's
products to the exclusion of all others. This strategy is typical of luxury goods retailers such as Gucci.

Channel Management – Conflict

1. Vertical Channel Conflict: Vertical channel conflict arises when manufacturer tries to sell on their own
while still maintaining working relationships with third-party retailers and distributors. This leads to
competition for sales where retailers and distributors often get lower profits for selling the same product
or service as the manufacturer is selling. Since it is primarily the retailers and distributors role to build
awareness of the product, this can lead to an overall decrease in sales. This situation is called a vertical
channel conflict because it affects two different levels of business, third-party sales and bottom-line
sales.

2. Horizontal Channel Conflict: In this type of channel conflict, a manufacturer not using third-party
retailers faces a struggle between two of its own sales divisions, such as its online and offline
departments. Usually one division starts to cut into the sales and profit of the other division, devaluing
the latter. Horizontal channel conflicts occur between two departments on the same level of importance

3. Multi Channel Conflict: Multilevel channel conflicts arise when a manufacturer creates competition
between its own sales and promotion arms, while also having business relationships with third-party
retailers and distributors. The reason for this approach may be to aggressively and more quickly expand
its sales and promotion network, but it can create both internal and external discord between the various
divisions and third-parties.
 

Advantages of Franchising

Advantages from the Franchisor’s point of view:

1. Financial: Franchising creates another source of income for the franchisor, through payment of franchise
fees, royalty & levies in addition to the possibility of sourcing private label products to franchisees. This
capital injection provides an improved cash flow, a higher return on investment and higher profits. Other
financial benefits that the franchisor enjoys are reduced operating, distribution and advertising costs. Of
course that also means more allocated funds for research and development. Additionally, there will
always be economies of scale with regard to purchasing power.

2. Operational: The franchisor can have a smaller central organization when compared to developing and
owning locations themselves. Franchising also means uniformity of procedures, which reflects on
consistency, enhanced productivity levels and better quality. Effective quality control is another
advantage of the franchise system. The franchisee is usually self motivated since he has invested much
time and money in the business, which means working hard to bring in better organizational and
monetary results. This also reflects on more satisfied customers and improved sales effectiveness.

3. Strategic: To the franchisor, franchising means the spreading of risks by multiplying the number of
locations through other people’s investment. That means faster network expansion and a better
opportunity to focus on changing market needs, which in its turn means reduced effect from
competitors.

4. Administrative: With a smaller central organization, the business maintains a more cost effective labour
force, reduction of key staff turnover and more effective recruitment.

B. Advantages from a Franchisee’s point of view:

1. Avoiding the unnecessary trial and error period in starting and operating a new business.
2. Lower financial risk, compared to other ventures, because investment costs are lower and profit margins
are higher.
3. Business Format Franchising complete packages ensure a ready to go “turn-key” franchised unit.
4. Managing a small business whilst depending on the power of the franchisor company which has a bigger
organization.
5. The franchisee has an opportunity to run a proven business concept with a successful operational track
record.
6. The opportunity to learn the latest developments and changes in the local and global market from the
franchisor and focus entirely on developing the sales revenues.
7. The benefit of operating under a recognized trade name/trademark, which can have better marketing
results.
8. The franchisee has access to accumulated business experience and technical know-how in managing the
business.
9. A unified store design which leverages the business reputation in marketing the concept.
10. Easier purchasing, storing, and product display systems.