Presentation on theme: "Marketing Fundamentals. What is Marketing?? Marketing is the sum of all the activities involved in planning, pricing, promoting, distributing, and selling."— Presentation transcript:
What is Marketing?? Marketing is the sum of all the activities involved in planning, pricing, promoting, distributing, and selling of goods and services to satisfy consumers’ needs and wants.
Marketing seeks to –discover the needs and wants of prospective customers; and –satisfy them.
The key to achieving these two objectives is the idea of exchange: the trade of things of value between buyer and seller so that each is better off after the trade. Example: ME: Hungry McD’s: Needs to sell food ME: Buy food McD’s: Makes money
Requirements for Marketing to Occur 1. Two or more parties with unsatisfied needs –I need of food, McD was in need of selling food in order to make money 2. Desire and ability to satisfy those needs –I want to curb my hunger and have money, McD has food and a way for me to purchase it from them 3. A way for the parties to communicate –I watch TV, McD advertises its products on TV –I receive mail, McD sends out coupons 4. Something to exchange –I have money, McD has food
In order to achieve your marketing objectives and successfully “put the right product in the right place, at the right price, at the right time, you need to create a plan In marketing, this plan revolves around the 4 Ps and 2 Cs. Each “P” and “C” or element must be taken into consideration in order to effectively market your business to your customer These elements are interrelated and must be planned in combination with each other – there is no “order” as to when each is done The Marketing Mix
Product Tangible object or service Do market research to find out who customer is and what they want Results will tell you what to make, how to package it, brand name ideas, image to portray, etc.
Price The process of determining what to charge for the product or service Needs to reflect what the customers are willing and able to pay
To set your price, you need to look at many variables such as: - production costs (materials, labour, packaging, advertising, etc) - state of supply and demand - competition
Place Essentially asks “Where is your product or service going to be?” You need to figure out how to make it easy for your customer to find and buy your product or service Look at : Place: retail (display, where on shelf – cereal low) Direct sales, internet, etc.. Timing: all time (ie cereal) vs seasonal (Xmas)
Promotion Actual marketing of product or service…make customer aware of it and how to get it Advertising (newspaper, radio, TV, internet), Public Relations, sales force…etc,
To promote you need to decide on the “message” you want to get across In order to accomplish this, you need to focus on the 5 W’s: Where, When, Why, What, Who If you can get the 5 W’s across, you will be successful
Joke Break What did one snowman say to the other? A: Do you smell carrots??
The 2 “C”s In order to perform an effective “Marketing Mix” assessment, a marketer must also consider the 2 “C”s of marketing: Customer Competition By understanding who we are selling to and who we’re competing against, we are more likely to be successful in selling our product or service
Customer Who is your customer?? A successful marketer must do their homework and find out the demographics of their customer –Who they are, what they look like, where they are, etc…. By researching your customer, a marketer will be able to find out your “target market” and their characteristics –Ie - buying habits, interests, gender, age and ethnicity, geographic range. If we have a differentiated product that provides a benefit to a customer we know, we are well on our way to success !!!
Competition there is a common phrase in business that states: “you need to know your competition better than yourself” although this is impossible, the intention is critical to your success you must understand what it is you do better or different than your competition….and make sure this is the focus of everything you do !!!
Conclusion Although much research has been done on “marketing”, it is not a science – you need to try things out, re-evaluate, make changes… It’s a “calculated risk” vs “blind risk”
Famous Marketing Blunders 1. Scandinavian vacuum manufacturer Electrolux used the following in an American campaign: "Nothing sucks like an Electrolux." 2. Coors put its slogan, "Turn It Loose," into Spanish where its translation was read as "Suffer From Diarrhea." 3. Clairol introduced the "Mist Stick", a curling iron, into German only to find out that "mist" is slang for manure. Not too many people had use for the "manure stick." 4. When Gerber started selling baby food in Africa, they used the same packaging as they did in the U.S., with the beautiful Caucasian baby on the label. Later they learned that in Africa, companies routinely put pictures on the label of what's inside, since most people can't read. Yikes! 5. Pepsi's "Come alive with the Pepsi Generation" translated into "Pepsi brings your ancestors back from the grave", in Chinese. 6. The Coca-Cola name in China was first read as "Ke-kou-ke-la", meaning "Bite the wax tadpole" or "female horse stuffed with wax", depending on the dialect. Coke then researched 40,000 characters to find a phonetic equivalent "ko-kou-ko-le", translating into "happiness in the mouth." 7. When Parker Pen marketed a ball-point pen in Mexico, its ads were supposed to have read, "It won't leak in your pocket and embarrass you." Instead, the company thought that the word "embarazar" (to impregnate) meant to embarrass, so the ad read: "It won't leak in your pocket and make you pregnant."
Let’s look at some examples of a company’s marketing mix analysis:
PRODUCT describe in detail what services/products/ideas they sell Porsche sell high performance automobiles that are perceived as being “elite” Only the highest end parts / equipment / engineering are used to create these automobiles Cars are engineered for speed and comfort PRICE describe the price range (i.e. Very Expensive $5000 gold watch) (i.e. Low price – “Dollarama”) $50,000 - $500,000 Canadian Very expensive, price creates “image” of high quality / status
PLACE in general, where are they located? Busy area, convenience, high traffic, etc. Porsche dealerships Dealerships are very clean and portray an image of high quality and status Customers “pull” these cars through the distribution chain, therefore location is not critical PROMOTION what forms of advertising do they use? what types of promotions and/or sponsorships do they use? Porsche use a variety of media to promote their cars (TV, magazines, internet, auto shows) In each case, they will portray an image of high end performance and status Media are focused on high income customers & their interests
CONSUMER describe who their typical customer is i.e. Think of their age, gender, income level, where they come from, interests, education, type of employment... male, 35-60, high income, post- secondary education, professional career, price insensitivity COMPETITION who is their direct competition? who is their indirect competition? how do they differ from their competition? Direct: Other high end auto manufacturers (Lamborghini, Mercedes, Roll-Royce, Aston Martin, etc.) Indirect: Any other high priced “toy” (i.e. – TVs, boats, plane, etc.) Porsche differ from their competition through reputation and strengthening their brand equity within the marketplace
PRODUCT describe in detail what services / products / ideas they sell Portable Computers – including Mac products such as Mac Book Pro, iMac, MacBook Air, Mac Mini, Xserve Servers – including Xserve, Xsan, MacOS X Ser, MobleMe. AppleTV Accessories – including MagicMouse, Keyboard, Led Cinema Display. Wi-fi Based Stations - including Airport Express, Airport Extreme, Time Capsule. Developer – including Developer Connection, Mac Program, iPhone Program. iPod – including iPod Shuffle, iPod Nano, ipod Classic. iPhone – including iPhone3GS, iPhone3G, iPad. iTunes – including movies, TV shows, audio books, games. Periphal products – including Printers, Storage devices, digital videos cameras
PRICE describe the price range (i.e. Very Expensive $5000 gold watch) (i.e. Low price – “Dollarama”) Apple is a premium brand computer that does not attempt to compete on price. The company has reduced prices after some initial product launches. It uses skimming and preimuim pricing strategies. The AppleiPad is priced at a minimum of $499. The Apple iPhone costs begin at $99. The Apple iPod Classic is priced starting at $249. The Apple iPod Nano costs $149. The Apple Mac Book costs $999. The Apple MacBook Pro is priced at $1199. The Apple Quicktime Pro for Windows costs $29.99 Apples iPad pricing strategy includes the flexibility to lower the prices if consumer response dictates such action. In 2009 Apple announced a reduced cost pricing structure for iTunes - songs will cost 69 cents, 99 cents or $1.29. Changes are said to be a response to a slower pace of music downloads.
PLACE in general, where are they located? Busy area, convenience, high traffic, etc. Apple, Inc Headquarters are located at is located at 1 Infinite Loop, Cupertino, California. Apple service providers are certified technicians, who complete regular Apple training and assessments, and offer repair services, and exclusive access to genuine Apple parts. They are located in Asia/Pacific, Africa, the Middle East Europe and Latin America. Apple has over 200 retail stores worldwide including the US, UK and Canada. Apple recently opened a new retail store in Shanghai China. Apple also sells through numerous on-line and Bick and Mortar retailers.
PROMOTION what forms of advertising do they use? what types of promotions and/or sponsorships do they use? Apple uses a variety of media to promote their cars (TV, magazines, internet) In each case, they will portray an image of high quality, ease of use and style Media casts a wide net on the tech savvy and the those who know nothing about tech, but want to be in style. Apple offers special discounts on refurbished MacIntosh computers, iPod Nanos, and the iPod Touch. The online Apple Store offers free shipping for orders over $50. Apple sometimes provides rebates when you purchase a specific product. Apple has packaged back-to-school offers, including some aimed at college students.
CONSUMER describe who their typical customer is i.e. Think of their age, gender, income level, where they come from, interests, education, type of employment... Huge worldwide market with target consumers aged 12+. Specific markets that are targeted include those who are willing to pay more for Apple products even though there are plenty of cheaper options. People who are really interested in being up to date with the latest technology, and who want to be connected to the internet all the time to keep up with the latest news. Music fans. Professionals who need to be able to connect to the internet any time anywhere COMPETITION who is their direct competition? who is their indirect competition? how do they differ from their competition? Direct and Indirect: Other high end electronics / computer / cell phone / Music player / music service providers and manufacturers (Samsung, HTC, Nokia, RIM, Sony, etc.) Apple differs from their competition through a reputation of style, functionality and quality.