Subject: Marketing Management

Module 2 – MARKETING MIX

Introduction:

Marketing mix is a combination of product, price, place and promotion. Also pricing
strategies designed to produce satisfying exchanges with predefined consumers. The
components of marketing mix can be controlled by marketers to influence consumers
to purchase its products.

Definition: According to Philip Kotler, “A Marketing Mix is the mixture of

controllable marketing variables that the firm uses to pursue the sought level of sales in
the target market”

Components of Marketing Mix

A. PRODUCT

Ø Product: A product is an item that is built or produced to satisfy the needs of a certain
group of people. The product can be intangible or tangible as it can be in the form of
services or goods.
Ø Product can be described as a bundle of benefits which a marketer offers to the
consumer for a price.

Product Mix:

Definition: The Product Mix also called as Product Varieties, refers to the complete range
of products that is offered for sale by the company.
The product mix has four dimensions/elements: Breadth, Length, Depth, and Consistency. The
Breadth of a product mix shows the different kinds of product lines that firm carries.

Major elements of a product mix

A company’s product mix contains four main components.

Marketing Management: Notes compiled by Ms. Sridevi M (Administrative Management College) 1

 • Length: The range of products available in a particular product line.
• Breadth: The number of product lines under a company.
• Depth: The options available in a particular product line, such as different quantities,
sizes, etc.
• Consistency: How closely related product lines are to one another in their use,
production, and distribution channels.

Example:

Difference between product mix vs product line

The terms ‘product mix’ and ‘product line’ are often interchanged. And while they share some
overlapping qualities, the two are actually very distinct.

So, when it comes to product mix vs product line, what’s the difference?

• A product line is a singular line of similar products that are sold within a company.
• A product mix is the combination of all product lines sold by the business. Some
companies may have multiple product lines contributing to a large product mix.

When keeping product mix vs product line in mind, the key thing to remember is that a business
needs to have a mixture of product lines to have a product mix.

A company can have many product lines, but only one product mix.

Product Life Cycle (PLC):

Definition: A product life cycle is the length of time from a product first being introduced to
consumers until it is removed from the market. A product’s life cycle is usually broken down
into four stages; introduction, growth, maturity, and decline.

Marketing Management: Notes compiled by Ms. Sridevi M (Administrative Management College) 2

There are four stages of a product’s life cycle, as follows:

1. Market Introduction and Development

This product life cycle stage involves developing a market strategy, usually through an
investment in advertising and marketing to make consumers aware of the product and its
benefits.

At this stage, sales tend to be slow as demand is created. This stage can take time to move
through, depending on the complexity of the product, how new and innovative it is, how it
suits customer needs and whether there is any competition in the marketplace.

2. Market Growth

If a product successfully navigates through the market introduction it is ready to enter the
growth stage of the life cycle. This should see growing demand promote an increase in
production and the product becoming more widely available.

The steady growth of the market introduction and development stage now turns into a sharp
upturn as the product takes off. At this point competitors may enter the market with their own
versions of your product – either direct copies or with some improvements.

3. Market Maturity

At this point a product is established in the marketplace and so the cost of producing and
marketing the existing product will decline. As the product life cycle reaches this mature
stage there are the beginnings of market saturation.

Many consumers will now have bought the product and competitors will be established,
meaning that branding, price and product differentiation becomes even more important to
maintain a market share.

Marketing Management: Notes compiled by Ms. Sridevi M (Administrative Management College) 3

4. Market Decline

Eventually, as competition continues to rise, with other companies seeking to emulate your
success with additional product features or lower prices, so the life cycle will go into decline.

Many companies will begin to move onto different ventures as market saturation means there
is no longer any profit to be gained. Of course, some companies will survive the decline and
may continue to offer the product but production is likely to be on a smaller scale and prices
and profit margins may become depressed.

New Product Development:

Definition: New product development is a process of taking a product or service from

conception to market. The process sets out a series of stages that new products typically go
through, beginning with ideation and concept generation, and ending with
the product's introduction to the market.

Stage 1: Idea Generation

The new product development process starts with idea generation. Idea generation refers to the
systematic search for new-product ideas. Typically, a company generates hundreds of ideas,
maybe even thousands, to find a handful of good ones in the end. Two sources of new ideas
can be identified:
• Internal idea sources: the company finds new ideas internally. That means R&D.
• External idea sources: the company finds new ideas externally. This refers to all kinds
of external sources, e.g. distributors and suppliers, but also competitors.

Stage 2: Idea Screening

Ø The next step in the new product development process is idea screening. Idea screening
is the process of filtering the ideas to pick out good ones. In other words, all ideas
generated are screened to spot good ones and drop poor ones as soon as possible.
Ø While the purpose of idea generation is to find the succeeding stages and to reduce that
number. The reason is that product development costs rise greatly in later stages.

Stage 3: Concept development & Testing

To go on to the next stage of the new product development process, attractive ideas must be
developed into a product concept. A product concept is a detailed version of the new-product
idea stated in meaningful consumer terms.

Marketing Management: Notes compiled by Ms. Sridevi M (Administrative Management College) 4

 Ø A product idea is an idea for a possible product.
Ø A product concept is a detailed version of the idea stated in meaningful consumer terms
Ø A product image is the way consumers perceive an actual or potential product.

Concept Testing: New product concepts need to be tested with groups of target consumers.
The concepts can be presented to consumers either symbolically or physically. To increase
the reliability of the test, a more concrete and physical presentation of the product concept may
be needed.

Stage 4: Market Strategy Development

The next step in the new product development process is the marketing strategy development.
When a promising concept has been developed and tested, it is time to design an initial
marketing strategy for the new product based on the product concept for introducing this new
product to the market.

The marketing strategy statement consists of three parts and should be formulated carefully:
Ø A description of the target market, the planned value proposition, and the sales, market
share and profit goals for the first few years
Ø An outline of the product’s planned price, distribution and marketing budget for the
first year
Ø The planned long-term sales, profit goals and the marketing mix strategy.

Stage 5: Business Analysis

Ø The fifth step in the new product development process involves a review of the sales,
costs and profit projections for the new product to find out whether these factors satisfy
the company’s objectives. If they do, the product can be moved on to the product
development stage.

Ø In order to estimate sales, the company could look at the sales history of similar
products and conduct market surveys. Then, it should be able to estimate minimum and
maximum sales to assess the range of risk. When the sales forecast is prepared, the firm
can estimate the expected costs and profits for a product, including marketing, R&D,
operations etc. All the sales and costs figure together can eventually be used to analyze
the new product’s financial attractiveness.

Stage 6: Product development

Ø The new product development process goes on with the actual product
development. The R&D department will develop and test one or more physical versions
of the product concept. Developing a successful prototype, however, can take days,
weeks, months or even years, depending on the product and prototype methods.
Ø Also, products often undergo tests to make sure they perform safely and effectively.
This can be done by the firm itself or outsourced.
Ø In many cases, marketers involve actual customers in product testing. Their experiences
may be very useful in the product development stage.

Marketing Management: Notes compiled by Ms. Sridevi M (Administrative Management College) 5

Stage 7: Test Marketing

Ø In this stage of the new product development process, the product and its proposed
marketing Programme are tested in realistic market settings. Therefore, test marketing
gives the marketer experience with marketing the product before going to the great
expense of full introduction.
Ø In fact, it allows the company to test the product and its entire marketing Programme,
including targeting and positioning strategy, advertising, distributions, packaging etc.
before the full investment is made.

Stage 8: Commercialization

Ø Test marketing has given management the information needed to make the final
decision: launch or do not launch the new product. The final stage in the new product
development process is commercialization.
Ø At this point, the highest costs are incurred: the company may need to build or rent a
manufacturing facility. Large amounts may be spent on advertising, sales promotion
and other marketing efforts in the first year.

Reasons for failure of new product:

Marketing Management: Notes compiled by Ms. Sridevi M (Administrative Management College) 6

Branding:

Definition: Branding is the process of creating strong awareness of a product or service in the
market through the use of a logo, design, symbol, or slogan and using them for advertisement.
It helps in effective communication and creates a substantial and positive impact on the
customer’s mind.

Importance of branding:

An entity should follow specific branding guidelines to be successful. They are listed as
follows:

1. Clarify the product mission – Branding clarifies the product’s mission and vision. It
tells the customer the purpose of creating the product and what customers can expect
from it.
2. Facilitate online shopping – During online shopping, it is impossible first to touch and
feel and then place the buy order. So here comes the brand value, which helps in
attracting buyers.
3. Identify the target market – The first step is identifying the target market, which
helps entities understand what kind of customers they will serve.
4. Create a positive image – It increases the value of products and services, thus
projecting a positive impression.
5. Improve customer service – To maintain the brand name, companies try their best to
deliver and maintain a high level of customer service.
6. Customer retention – Retaining customers once made is extremely important
because it is easier and less costly to retain old and existing customers than to make
new ones.
7. Increase business value – Since good brands mean more consumers trust and value
the product, branding also increases the value of the business.
8. Source of employee pride – Even the employees working in the organization feel a
sense of pride when they are associated with a famous brand.

Packing or Packaging:

Definition: Packaging ensures safety and can be defined as wrapping an item to ensure its
distribution, storage, sale, and use. Functions of packaging include physical protection as well
as handling, containment protection, tamper-resistant, information transmission, ease of use,
and aesthetics.

Importance of Packaging the Product

Packaging a product in an appropriate way is essential because,

• Safeguarding your product and keeping it in good order during transport and storage is
important.
• It can also aid in extending the longevity of your item.
• It can be used as a promotional tool to draw attention and communicate details about
the product.

Marketing Management: Notes compiled by Ms. Sridevi M (Administrative Management College) 7

 • Packaging is a way to reduce theft and petty theft.
• Packaging may help you comply with legal requirements.
• Packaging can be reused or recycled, which reduces consumption and also saves
resources.
• Ultimately, the packaging is essential to the customer experience, offering convenience
and value.

Labelling:

Labelling is the display of label in a product. A label contains information about a product on its
container, packaging, or the product itself. It also has warnings in it.

For e.g. in some products, it is written that the products contain traces of nuts and shouldn’t be
consumed by a person who’s allergic to nuts.

Labelling is also an important part of the brand of the product and the company. It helps the
product stand out in the market, and identifies it as a part of a particular brand. This is important
in the era of high and intense competition.

Marketing Management: Notes compiled by Ms. Sridevi M (Administrative Management College) 8

 B. PRICING

Definition: According to Philip Kotler, “Price is the amount of money charged for a product
or service”. Broadly, price is the total amount that being exchange by the consumer to obtain a
benefit of the product or service owning.

Objectives of Pricing Policy

Survival

Survival is a very important objective of pricing. The company depends upon the selling price
to cover the cost.

Company managers always try to find out pricing strategies that will result in long-term
survival in business. Price helps to bring stability into current business and help to move
forward towards growth.

Return on Investment

A company should set pricing for its product in such a way as to earn a minimum return on
its investment. Every company has a particular target to have a minimum return on investment.
Increase Market Share

Pricing plays important role in increasing the market share of a company. If the company thing
that its market share is low in the industry then it should make its pricing strategies in such a
way that desired market share can be achieved in the industry.

Marketing Management: Notes compiled by Ms. Sridevi M (Administrative Management College) 9

Competition

Pricing has acted as a barrier to the entry of new competitors into similar businesses. The
company modified its pricing strategies to deal with its competitor. While fixing the price for
its production company should see the price of its competitor.

Customer Satisfaction

The customer is the ultimate user of the company product. Customer satisfaction helps the
company to achieve growth in the market. A reasonable pricing policy helps the company to
win customer confidence and trust.

Corporate Image

Proper pricing policy has an effect on the company’s goodwill in the market. Companies create
a good image in the minds of consumers by charging reasonable prices. A good image in the
mind of customers helps the company to increase its customer base and grow faster.

Launching of New Product

An effective pricing strategy at the time of introducing new products in the market is very
important.

In the introduction, a state company should generally charge low prices for its product to create
a customer base and win customer confidence. A low pricing policy for new products helps the
company to encourage buyers to purchase the product.

Stability in Pricing

Companies charging stable prices for its product get more preferred by customers in the market.
Most of the company change prices for its product on a seasonal basis. A stable price
throughout the year helps to get more prospective consumers. The company should
adopt pricing strategies to remove seasonal fluctuation in its price.

Factors Influencing Pricing Decisions

Objectives of Business

There may be various objectives of the firm such as getting a reasonable rate of return, the
capture of the market, maintenance, and control over sales and profit. Thus pricing
policy should be established only after proper consideration of the objective of the firm.

Cost of Product

The cost and price of the product are closely related. Normally, the price shall not be fixed
below its cost (including the product administrative and selling costs).

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Market Position

Ø The prices of different producers are different either because of differences in quality
or because of the goodwill of the firm or because of differences in costs.
Ø A reputed company may fix up the higher price for its products; on the other hand, a
new producer may fix lower prices for its products. Competition may also affect the
pricing decision.

Competitor’s Price

Ø A competitive condition affects the pricing decision. Even in monopolistic competition,

the producer has to consider the competition within substitute products before fixing
the price of his own products. If suppose. electric company increases the rate of
electricity, the consumer may shift to kerosene or gas.

Ø Moreover, some people may invent other lower substitutes. Besides this number of
competitors also affect the pricing decision.

Distribution Channel Policy

Ø The nature of distribution channels used and the trade discounts which have to be
allowed to distributors and distribution expenses also affect the pricing decisions.

Ø If the channel of distribution is lengthy, distribution expenses are made by each

middleman. If on contrary, the channel is short, the price may be fixed lower.

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Price Elasticity and Demand Elasticity

Ø Price elasticity means the consequential changes in demand for the change in prices of
the commodity. If the demand for the product is inelastic, the high price may be fixed.

Ø On the other hand, if the demand is elastic the firm cannot fix high prices rather it should
fix lower prices than that of competitors. If the demand is highly elastic, the price
reduction strategy would be adopted.

Product stages in the life cycle of a product

Ø Pricing decision is affected by the product in its Life cycle. In the introduction phase,
the policy followed is of penetration type, i.e. Lower price.
Ø This builds goodwill. In the growth phase price can be raised to the extent tolerated by
the consumers. In the decline stage, prices are to be reduced to maintain the demand.
Ø Product Differentiation

Buying Pattern of Consumers

Ø If the frequency of purchase of the product is higher, a lower price should be fixed to
have a low-profit margin. It will facilitate increasing the sales volume and the total
profit of the firm.

Ø All consumer items of daily use have high purchase frequency. Low purchase frequency
products are sold at high-profit margins and therefore at high prices. Consumer durable
items like refrigerators are priced higher.

Economic Environment

In a recession period, the prices are reduced to a sizable extent to maintain the level of turnover.
On the other hand, price is increased during the boom period to cover the increasing cost of
production and distribution.

Government Policy

If the producer fixes a higher price, the government may nationalize the cause. Something, the
government starts selling that product through fair-price shops.

Social and Ethical Consideration

Certain social and ethical consideration also affects the price decision:

1. Fair Price: Keeping in mind the social and ethical considerations, the producer
fixes a fair price for their products, neither too high to exploit the customers nor
too low to have unfairly low returns to the business.

2. Fear of Labour Leader: With the fear of higher wages and allowances, bonuses,
and better facilities by the labour the producers fix the price at a sufficiently low

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 level. It reduces labour disputes and promotes better labour relations.

3. Consumer Reaction Towards Rising Prices: A relational consumer also reacts to

rising prices. The awakened customer opposes the move of raising prices through a
concerted effort by forming associations for the purpose.

Methods/Strategies/Types of Pricing (or) Price Mix

1. Penetration pricing is a strategy used by businesses to attract customers to a new

product or service by offering a lower price initially. The lower price helps a new
product or service penetrate the market and attract customers away from competitors.

2. Price skimming, also known as skim pricing, is a pricing strategy in which a firm
charges a high initial price and then gradually lowers the price to attract more price-
sensitive customers. The pricing strategy is usually used by a first mover who faces
little to no competition.

3. Competitive pricing is a marketing strategy whereby businesses set prices based on

their competitors' prices. Also known as competitor-based pricing, this strategy can be
used in online and offline markets and is often used to attract more customers and
increase market share.

4. Product line pricing is a pricing strategy where a company offers a range of products
or services at different price points, with each product having a distinct set of features
and benefits.

5. Psychological pricing is a way businesses set prices to influence how customers

perceive the value of a product or service. They do this by using tactics like pricing just
below round numbers or choosing prices that sound appealing to make products seem
more affordable or attractive.

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 6. Cost-plus pricing is a pricing method used by companies to determine the price of a
product or service. It involves setting a price by adding a fixed amount or percentage
to the cost of a product or service.

7. Cost based pricing is a pricing strategy in which a company adds a markup to the price
of a product over the cost of production and manufacturing. The strategy often involves
adding a fixed percentage added on top of production costs for one unit.

8. Optional product pricing refers to the practice of selling the primary product at a
lower price to attract customer demand. And then charging a higher price for the
accessories that go with the main product.

9. Premium price is when the price of a product or service is significantly higher than
similar competing products because the company either demonstrates, or the consumers
perceive, that the product or service is of high quality or is particularly unique enough
to justify its elevated price.

10. Bundle pricing is a business strategy where companies group several products together
into a bundle and sell them at a single price, rather than attribute individual prices to
each item.

11. Geographic pricing: Geographical pricing is adjusting an item's sale price based on
location to reflect shipping costs or to meet the market-clearing price in that area.

C. PLACE

Introduction: Place is Physical distribution in which all the functions involved in moving
goods from production to the consumer. They include functions such as inventory control,
transportation, and customer service. All these functions collectively work together, and a
decision in one process affects the other.

Marketing Channels

Definition: Marketing channel is a system which ensures the distribution of the merchandise
from the producer to the consumers by passing it through multiple levels known as middlemen.
It is also known as channels of distribution.

Marketing Management: Notes compiled by Ms. Sridevi M (Administrative Management College) 14

 1. Product-Related Factors

The product’s features, specifications, nature, usage, value and durability plays a vital role in
the selection of marketing channels. Let us go through the related factors give below:

• Nature of Product: If the product is a general product which is widely used like
cosmetics, it requires a more extended channel. Whereas, the product which is
customised or has limited customers like industrial machinery needs a shorter
channel.
• Perishability: The goods which are perishable require to be sold through the
shorter channel. However, the products which are non-perishable can be
distributed through a longer channel.
• Unit Value of the Product: If the product is of low value it can be easily
distributed through the longer channel, but for the products which are expensive
and valuable the manufacturers prefer a shorter channel.
• Product Complexity: If the product is complicated to use and has technical
specifications, it will require a shorter channel. The products which are user-
friendly and easy to handle can be sold through longer channels.

2. Company Related Factors

The company’s financial condition, objectives, privacy policies and level of control influences
the selection of a particular marketing channel:

• Finance Available: If a company is financially sound it can go for a shorter

channel of distribution by opening its retail outlets otherwise it can opt for a
longer marketing channel.
• Core Competency: If the manufacturing company focus on its core ability which
is the production of goods it will be least interested in retailing. Thus it can opt
for a longer marketing channel.
• The degree of Control: If the company wants to regulate its sale and the market
segment it caters, it will prefer a shorter channel. The companies which do not
exercise much control over its products go for a longer distribution channel.

3. Competitive Factors

The competitors affect the company’s decisions related to the selection of marketing channels
in the following ways:

• Competitor’s Channel of Distribution: Sometimes the companies follow their

competitors and use the same channel as adopted by them.
• Distribution Policy: Some companies have a different distribution policy, and
they adhere to it. Multi-level marketing (MLM) companies usually stick to their
chain marketing policy.

4. Market-Related Factors

The market is the place where the customers are served. Thus, it has a crucial role in
determining the type of channel for any product. Let us see these factors in detail:

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 • Market Size: When the company needs to reach a large number of customers, it
has to go for the longer channel. If the company has to cater a few customers, it
can opt for a shorter channel of distribution.
• Geographical Concentration: If the potential customers are located in a vast
geographic area, the company can reach them through a longer channel. The
shorter channel will be preferred for the buyers located in the limited area.
• Quantity Purchased: If the product is purchased in bulk quantity by the limited
customers, a shorter channel is suitable whereas the products which are bought
in small quantities by multiple customers, a longer channel will work.

5. Environmental Factors

Every business operates within an environment where it has to deal with some legal obligations
as well as economic conditions. These factors include the following:

• Legal Environment: The government imposes certain legal restrictions over

trading activities which also affects the selection of a distribution channel. Like
selling of weapons cannot take place through a longer channel.
• Economic Conditions: At the time of recession or depression in a country, the
manufacturers prefer to reduce their distribution cost by going for a shorter
marketing channel.

Distribution Strategy:

• Distribution Strategy is a strategy or a plan to make a product or a service available to

the target customers through its supply chain. Distribution strategy designs the entire
approach for availability of the offering starting taking inputs from what the company
communicated in marketing campaigns to what target audience is to be served.

Three types of Distribution Strategies or Marketing channels,

1. Conventional Marketing Strategy

2. Vertical Marketing Strategy
3. Horizontal Marketing Strategy

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 1. The conventional distribution channel is the most common distribution
channel. It comprises of a producer, wholesalers and retailers, all acting
independently.
Hence, having coordination between these three becomes the major challenge
for such a system. Also, channel conflicts are very common, leading to
disruptions in distribution. Due to this, companies are now going towards
developing integrated channels.

2. A vertical marketing system (VMS) is one in which the main members of a

distribution channel—producer, wholesaler, and retailer—work together as a
unified group in order to meet consumer needs. In conventional marketing
systems, producers, wholesalers, and retailers are separate businesses that are
all trying to maximize their profits.

3. A horizontal marketing system is a distribution channel arrangement whereby

two or more organizations at the same level join together for
marketing purposes to capitalize on a new opportunity.

For example: a bank and a supermarket agree to have the bank’s ATMs located
at the supermarket’s locations; two manufacturers combining to achieve
economies of scale otherwise not possible with each acting alone to meet the
needs and demands of a very large retailer; or two wholesalers joining together
to serve a particular region at a certain time of year.

D. PROMOTION

Ø Promotion is an important ingredient of marketing mix as it refers to a process of

informing, persuading and influencing a consumer to make choice of the product to be
bought. Promotion is done through means of personal selling, advertising, publicity and
sales promotion.

Role and significance of promotion:

1. Persuades Customer
2. Provides Information
3. Image Creation
4. Motivates distribution partners
5. A tool to fight Competition.

1. ADVERTISING:

Advertising is a means of communication with the users of a product or service.

Advertisements are messages paid for by those who send them and are intended to
inform or influence people. The goal of advertising is to reach people most likely to be
willing to pay for a company’s products or services and entice them to buy.

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1. Print Media

Newspapers, magazines, periodicals, pamphlets, etc. that we read in our daily life are called
as print media. We often come across various advertisements while reading a newspaper, for
example, sales advertisements or rent advertisements. The people get attracted by such
publications and land up buying the product or service. Print media is the best for only the
people who can read.

2. Television Media

Television media is the best and most popular way of advertising the product and service to
reach a mass group of people. The people who cannot read or write are also exposed to
television. For once someone may not buy a newspaper, but without any fail, they are going to
watch TV. If the right story is chosen for advertising, the product or service will end up
attracting every class or age group of people.

3) Electronic Media

The bulletins, emails, etc. are known as electronic media. It is the most professional and
historical way of advertising something. Electronic Media is limited to people as it reaches
only to a selected class of people.

The most basic level of electronic advertising medium includes video recordings, multimedia
presentations, audio recordings, CD-ROM, multi-media presentations, online content, etc.

4) Events and Experiences/ Outdoor Media

One another great way of attracting the attention of the public is through conducting various
activities and experiences. Many times it can be seen that multiple companies and their
products sponsor the events are either given away as free samples or showcased as an
experience. It is the best way to build the trust of the product in the minds of the customers.
For example, events like Bacardi party sessions are sponsored by themselves, and the party
contains the beverages from Bacardi.

5) Radio Media

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This is yet another popular and fantastic advertising option that people can try. The
advertisements for the companies would easily be broadcasted from the different stations
related to the Radio stations. FM radio channels are quite prominent these days. So, it is going
to work for the companies without any hassle.

6) Digital Media

In today’s time, Digital Media or Mobile Media is the most popular type of advertising media.
It helps brands optimize their reach on the web. By using digital channels of advertisements,
you can reach to the smartphones, laptops, and tablets of your target audiences.

Digital Advertising Media helps businesses in meeting their audiences on different social
media networks, search engines, and various applications with personalized ad campaigns
based upon their inclinations and behavioral preferences.

Different types of online ads that you can run in Digital Advertising Media are-

• Google Search Ads

• PPC Ads
• AdWords Ads
• Facebook Ads
• Bing Ads
• Twitter Ads
• Tumblr Ads
• Google Display Ads
• Banner Ads
• Retargeting Ads
• Flash Ads
• Mobile Ads
• In-Game Ads
• Reddit Ads
• AdMob Ads
• Gmail Ads
• Email Ads
• Video Ads
• YouTube Ads
• Instagram Ads
• Pinterest Ads

2. PERSONAL SELLING:

Ø Personal selling is also known as face-to-face selling in which one person who is the
salesman tries to convince the customer in buying a product. It is a promotional method
by which the salesperson uses his or her skills and abilities in an attempt to make a
sale.
Ø The salesperson tries to highlight various features of the product to convince the
customer that it will only add value. However, getting a customer to buy a product is
not the motive behind personal selling every time.

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 Personal Selling Process

The six-step process by which creative selling is carried out includes:

[Link] and Qualifying Prospects:

The first step involves identifying potential customers who are likely to be interested in the
product or service being offered. This requires market research, analysis of customer profiles,
and segmentation.

Qualifying prospects involves assessing their needs, budget, authority to make purchasing
decisions, and overall fit with the product or service. Qualifying is also known as pre-
approach because the information collected in this step, like requirements of the prospect
acts as a foundation for the planning of further steps of this process.

[Link] the Prospect:

Once prospects have been identified and qualified, the salesperson needs to make initial
contact with them. This can be done through various means such as cold calling, referrals,
networking, or digital communication channels.
The goal is to create a positive first impression and establish a rapport with the prospect. To
successfully accomplish this step, it is essential that the salesperson making initial contact
with the potential customer is experienced, has done his research, and is cautious while
approaching the prospect.
[Link] the Sales Presentation:

The sales presentation is where the salesperson presents the product or service to the prospect,
highlighting its features, benefits, and value proposition.
Creativity plays a crucial role in this step, as the salesperson needs to tailor the presentation
to address the specific needs and preferences of the prospect. Using compelling visuals,

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storytelling techniques, and interactive demonstrations can enhance the effectiveness of the
presentation. While making a presentation, the salesperson should keep in mind that some of
the communication may not be verbal.
[Link] Objections:

During the sales presentation, prospects may raise objections or concerns about the product
or service. The salesperson needs to address these objections in a creative and persuasive
manner. This requires active listening, empathy, and the ability to provide relevant
information or evidence that alleviates the prospect’s concerns. Offering alternative solutions
or additional incentives can also help overcome objections.
[Link] the Sale:

Closing the sale is the pivotal step where the salesperson encourages the prospect to make a
purchase decision. Creative selling techniques such as trial closes, limited-time offers, or
personalised incentives can be used to create a sense of urgency and motivate the prospect to
take action. Building trust, emphasising the value proposition, and addressing any remaining
concerns are essential in this stage.
[Link] Up:

After the sale is made, it is crucial to maintain a relationship with the customer and ensure
their satisfaction. Following up involves activities such as sending thank-you notes,
providing post-purchase support, and seeking feedback.
Creative follow-up strategies can include personalised messages, exclusive offers, or ongoing
communication to foster customer loyalty and generate repeat business.

SERVICES MARKETING MIX

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3 additional Ps – 7 Ps as the Marketing Mix for Services

The 4 Ps, comprising product, price, place and promotion build the 4 critical pillars of every
marketing strategy. However, the distinctive characteristics of services requires the addition of
three more Ps – people, physical evidence and process. This is necessary as services differ
strongly from products in their nature: aspects such as customer involvement in production and
the importance of the time factor require that additional strategic elements are included to yield
an exhaustive marketing mix for services.

What is meant by each of them?

§ People – the appearance and behavior of service personnel. People are the most
important defining factor in a service environment: a service is obviously inseparable
from the person providing it, which is different than in case of a tangible product. For
instance, a restaurant is not only good because of good food, but because of a good
service provided by its staff.

§ Process – how the service is delivered, the actual procedures and flow of activities. The
process of service delivery is crucial since it ensures that the same standard is repeatedly
delivered to customers. For this reason, most companies have something like a service
blue print, lining out the details of the standardized service delivery process. For
example, fast food chains have clearly specified processes for customer servicing,
which may even include standardized phrases.

§ Physical evidence – everything from the appearance, design, layout of the service
setting, to aspects like brochures, equipment (the tangible parts of the actually
intangible). Since services are intangible in nature, most service providers aim to
incorporate certain tangible elements into the offering. This enables an enhanced
customer experience.
§ For instance, in a barber shop you usually will find well designed waiting areas with
magazines, sofas etc. To return to the restaurant example, you may find that restaurants
invest quite a lot in their interior design and decorations to offer a tangible experience
to their customers.

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