Marketing may be defined as a social and managerial process whereby individuals and groups

obtain what they need and want through creating and exchanging product and value with others.

Markets- a market might be defined as the set of all actual and potential buyers of a product or
service. A market might not be in a set place.

Products and Services

A Product can be anything that is offered to a market for its attention purchase or consumption
that might satisfy a need or a want. A product is tangible.
A Service is any activity or benefit that one party can offer to another that is essentially
intangible and does not result in the ownership of anything

Marketing activities
Marketing activities are tactics and strategies that a business employs to encourage customers
to buy goods or services.

Marketing activities
There are a number of marketing activities that all need to work together In a consistent way in
order to achieve the targets set out In a marketing plan. These activities are described in the table
below.

Marketing activity Details

Market research is carried out to find out about the characteristics of a market in order to meet
market requirements. It can be carried out through large-scale surveys (questionnaires to many
people) or on a much smaller scale, for example through face-to-face interviews. Market
research might aim to find out about the following.
• Consumer taste: what do consumers like and want from a product? Whicn colours, shapes,
tastes, etc. do they prefer?
• Competition: what are the competitors doing? This Includes the prices they charge, which
outlets they sell In, the characteristics of their products, etc,
• Consumer behaviour: what are the factors that influence consumers to buy one product over
another? How do consumers buy products and how does their buying behaviour change?

Pricing Deciding on a price is a key marketing activity. It will be determined by internal factors
such as, the cost of making and selling an item and external factors such as competitor pricing.

Packaging The first time a customer sees many products Is when they are packaged. Marketing
should therefore ensure that the packaging makes a product look more attractive, enables easy
stacking and transport, protects the product and keeps it fresh, and provides
details about how to use the product.

Branding A key aspect of marketing is the creation of a brand. A brand is a product or group of
products with a unique, consistent and easily recognizable character. For example, we all
recognise the Coca-Cola brand, not only by its logo but by also by its packaging (the shape

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of the bottle, or the colour of the can) and the taste of 1he product.

Sales promotions are activities and techniques designed to increase the sales of a product (for
example by offering free samples or a buy-one-gel one- free promotion). They usually only last
'for a short period of time.

Advertising Marketing activity will seek lo identify tile best ways of advertising products and
brands in order to increase awareness of them. Advertising is designed to have greater long-term
effec1s than sales promotions.

Distribution Marketing also involves identifying the best approach to distribution, which is the
movement of goods from a source (such as a manufacturer) through distribution channels to the
final customer.

The Marketing Mix

The marketing mix is the set of controllable tactical marketing tools that the firm blends to
produce the response it wants in the target market. It includes
 The product
 The price
 The place
 The promotion
That is it includes the four P’s in marketing.

The product
The product- this is anything that can be offered to a market for attention, acquisition, use or
consumption that might satisfy a want or need.
It includes services also. A service is any activity or benefit that one party can offer to another
that is essentially intangible and does not result in the ownership of anything.
Products are said to have both features and benefits.
"Features" are the details of a product. For example, the main features of a car might be that it Is
blue, it has four doors, it has power steering and it runs on unleaded petrol. A product must have
the right features for a customer to want to buy It.
"Benefits· are what a product does for its customers {how, it satisfies their needs}. For example,
tile benefits of a car might be that it has enough room for the whole family to fit in and it is
cheap to run. Benefits are also very important when making a purchase.

The Product mix length refers to the total number of items the company carriers within its
product lines. For example the number of brand bath soap a company might sell.

Product line depth refers to the number of versions offered of each product in the line. For
example the different sizes offered and the different types.

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Pricing
Pricing is the method adopted by a firm to set its selling price. It usually depends on the firm's average costs, and on
the customer's perceived value of the product in comparison to his or her perceived value of the competing products.

What is a price? Price maybe defined as the amount of money charged for a product or service or the sum of the
value that consumer exchange for the benefit of having or using the product.

The process that is used to determine the price product might be dependent on a number of factors. These factors
may include:

1. the objective of the firm- a firm’s major objective might be to maximize its profit and as such this will
determine how the firm prices its product. For example to maximize its profit the firm may decide not to
sell at its lowest price but instead to sell at a higher price in order to achieve this objective. However if the
firm wants to dominate its market it may sell at a lower price than its competitors in order to attract buyers.
2. the marketing mix- the price chosen by a firm for its product or service maybe dependent on the overall
marketing mix that the firm is using. This means the price of a product must fit in with the nature of the
product itself and the way in which it is being promoted and distributed to consumers. For example if a
firm is carrying a low quality product amongst its products then it will price this product at a cheaper price
and market it to lower income consumers. This means that any promotional strategy the firm uses will be
geared to lower income consumers.
3. cost- the cost of production will also determine the price at which the company sells its products. A firm in
the long run must choose a price for its product that will cover its production cost and include a profit
element.
4. legislation- laws pass by the government about price will determine the price set by the firm.
5. competitors- price set by competitors for their product may affect the price of the firms product. For
example if competitors set a low price firm may also set a low price for its product in order to remain
viable.
6. market demand- if there is a large or great market demand for the product the firm maybe able to set a high
price for its product

General pricing strategies

Cost plus pricing- this is where the firm adds a standard mark-up to the cost of the product to determine its selling
price

Going rate pricing is a form of competition based pricing. This is where the firm based its price largely on the
competitions price with less attention paid to amount or to its own cost. Going rate pricing is popular especially
when firms find it difficult to measure the elasticity of demand for its product. It will make the assumption that the
going price represents the collective wisdom of the industry, concerning the price that will yield a fair profit.

Penetration pricing
This pricing method is generally used by a firm that wants to get a foothold in a market. It involves pricing a product
at a low level, generally, below the market price of the product to attract consumers to buy the product. This
technique is used with new product launch. When the product takes off in the market, the firm usually increases the
price of the product.

Price Skimming
This is where a firm sets a high price for a new product to skim maximum revenues from the segments willing to
pay the high price. Fewer units are sold but sales are more profitable.

Breakeven pricing/ Target profit pricing

This is where the firm sets the price so that it breaks even on the cost of making and marketing the product or where
it sets the price to make a target of it.

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Predatory destroyer pricing / A very low price is set in order to drive competitors out of the market

Place
Place has to do how/where the consumer gets to the product to purchase. The goods must be in
the right place at the right time for consumers. It is important to ensure that products arrive when
and where they are wanted. Place has to do with the distribution of the commodity. Distribution
deals with how the product moves from the manufacturer to the consumer. To reach the
customers the business uses a distribution channel.

A distribution channel/chain is a set of interdependent organizations involved in the process of

making a product or services available for use or consumption by the consumer or business user.
The traditional distribution channel/chain looks at moving the product from the manufacturer
to the wholesaler then to the retailer and finally to the consumer. The wholesaler and the
retailer may be referred to as middle men because they come between the manufacturer and the
consumer. Each of them places a markup on the product.
In recent years especially with the advances in technology firms have been moving to direct
marketing channel. A direct marketing channel is one that the manufacturer sells directly
to the consumer i.e. no middle man is used. They use the internet, sales representative etc to do
this.

Major Distribution/Logistics Functions

The following are the major functions of a distribution system:

1. Order Processing- this is where orders are taken by mail, telephone, through sales
person or with the use of a computer. Once orders are received they must be process
quickly and accurately.
2. Warehousing- every company must store its goods as it waits for them to be sold. To
store its goods the company will need warehousing. A wholesaler may generally provide
some warehousing function for the manufacturer. The manufacturer may also have a
distribution center.
3. Inventory- this is the stock of finished goods that a manufacturer has in store. Generally
the manufacturer does not like to carry large amount of inventories because this means
money tied up which could have been used otherwise however he must hold enough
inventory so that he is able to supply its market at all times. Therefore the manufacturer
has to balance the amount of inventory he carries against the need to satisfy and keep his
market.
4. Transportation- Moving the goods from the manufacturer to the consumer. the choice of
transportation will affect the pricing of the product, delivery performance and condition
of the goods when they reach the market. The company can choose five transportation
mode:

 rail
 road
 water

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  pipeline
 air

Specialized Transportation

Some goods require specialized transportation. For example, transporting by pipeline or

containerization. This is a shipping method in which a large amount of material (such as merchandise) is
packaged into large standardized containers
Oil is usually transported by pipeline.

Promotion
Promotion is defined as an activity designed to increase visibility or sales of a product.

Promotion is about communication with actual or potential customers. An effective promotion increases the
consumer awareness of the product.

Objectives of promotion

Promotional objectives can be the following

 To increase consumer awareness of a product
 To remind consumers of the existence of a product
 To encourage increased purchases
 To demonstrate the superior specification
 To create or reinforce the brand image
Promotion maybe grouped into two types:

 Above the line promotion- this is used in connection with advertising of a product or business through the
media.
 Below the line promotion- this is used with all types of promotion other than advertising over which the
business will have some direct control.

Different promotion strategies

Promotion may take different forms such as:

1. Advertising- this is any paid form of non- personal presentation and promotion of ideas goods or services
by an identified sponsor. It might be informative or it might be persuasive.

2. Personal selling- this is where the firm sales force make presentation to potential customers with the
intention of making sales and building customer relationships.

3. Sales promotion- this is the use of short term incentives to encourage the purchase or sale of a product or
service for example sampling, coupons, give away, competitions etc.

4. Public relations- this is building good relations with the companies various publics by obtaining favorable
publicity, building up a good cooperate image and handling or heading off unfavorable rumors, stories and

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 events it may involve the company putting out press releases, sponsoring scholarships or community
events.

5. Direct marketing- this is where the company undertakes direct communications with carefully targeted
individual consumers to obtain an immediate response and cultivate lasting customer relationships. Direct
marketing includes catalogues, telemarketing, and the use of the internet.