STRATEGIC MARKETING PLANNING

• all companies need strategies to meet changing markets.

• no one strategy is best for all companies
• the strategic plan guides marketing, which must work with other
departments in the organization to achieve strategic objectives
• Three stages of strategic market planning:
• First the strategic plan and its implications for marketing
• Second the marketing process;
• Third ways of putting the plan into action
THE PLANNING PROCESS

• Putting plans into action involves four stages:

• Analysis
• Planning
• Implementation and
• Control
ANALYSIS

• Planning begins with a complete analysis of the company's situation.

• The company must analyze its environment to find attractive
opportunities and to avoid environmental threats.
• It must analyze company strengths and weaknesses, as well as current
and possible marketing actions, to determine which opportunities it can
best pursue.
• Analysis feeds information and other inputs to each of the other stages.
PLANNING.

• Through strategic planning, the company decides what it wants

to do with each business unit.
• Marketing planning involves deciding marketing strategies that
will help the company attain its overall strategic objectives.
• Marketing, product or brand plans are at the centre of this
IMPLEMENTATION

• Implementation turns strategic plans into actions that will

achieve the company's objectives.
• People in the organization that work with others both inside and
outside the company implement marketing plans.
CONTROL

• Control consists of measuring and evaluating the results of plans

and activities, and taking corrective action to make sure
objectives are being achieved.
• Analysis provides information and evaluations needed for all the
other activities.
THE STRATEGIC PLAN

• The strategic plan contains several components:

• the mission
• the strategic objectives,
• the strategic audit,
• SWOT analysis,
• portfolio analysis,
• objectives and strategies.
• All of these feed from and feed into marketing plans.
THE MISSION

• A mission states the purpose of a company.

• Firms often start with a clear mission held within the mind of their founder. T
• Then, over time, the mission fades as the company acquires new products and markets.
• A mission statement is a statement of the organization's purpose -what it wants to
accomplish in the larger environment, A clear mission statement acts as an 'invisible hand'
that guides people in the organization, so that they can work independently and yet
collectively towards overall organizational goals.
• Traditionally, companies have defined their business in product terms ('we manufacture
furniture'), or in technological terms ('we are a chemical-processing firm'). But mission
statements should be market-oriented.
MISSION CONT

• Management should avoid making its mission too narrow or too

broad.
• A mission should be: Realistic. Specific. Distinctive and
Motivating
• Examples of mission statements
OBJECTIVES

• Should be SMART
• Specific
• Measurable
• Attainable
• Realistic
• Timeous
• The objective to 'increase our market share' is not as useful as the objective to 'increase our market
share to 15 per cent in two years'. The mission states the philosophy and direction of a company,
whereas the strategic
• Objectives are measurable goals
STRATEGIC AUDIT

• The extemal audit or marketing environment audit examines the macro environment and
task environment of a company.
• SWOT Analysis
• SWOT analysis draws the critical strengths; weaknesses, opportunities and threats (SWOT)
from the strategic audit.
• The audit contains a wealth of data of differing importance and reliability. SWOT analysis
distils these data to show the critical items from the internal and external audit.
• The number of items is small for forceful communications, and they show where a
business should focus its attention.
THE BUSINESS PORTFOLIO

• The business portfolio is the collection of businesses and products that make up the
company. It is a link between the overall strategy of a company and those of its parts.
• The best business portfolio is the one that fits the company's strengths and weaknesses
to opportunities in the environment.
• The company must analyze its current business portfolio and decide which businesses
should receive more, less or no investment and (2) develop growth strategies for adding
IKW products or businesses to the portfolio.

• ---------------------------------------------------------------------------------------------------------------------
ANALYSING THE CURRENT BUSINESS PORTFOLIO

• Portfolio analysis helps managers evaluate the businesses making up the company.
• The company will want to put strong resources into its more profitable businesses and phase down or drop its weaker ones.
• Management's first step is to identity the key businesses making up the company. These are strategic business units. A strategic business unit
(SBC) is a unit of the company that has a separate mission and objectives, and which can be planned independently from other company
businesses.
• An SBU can be a company division, a product line within a division, or sometimes a single product or brand.
• .In some companies, this occurs informally.
• Management looks at the company's collection of businesses or products and uses judgment to decide how much each SBU should contribute
and receive.
• Other companies use formal portfolio-planning methods. The purpose of strategic planning is to find ways in which the company can best use its
strengths to take advantage of attractive opportunities in the environment.
• So most standard portfolio-analysis methods evaluate SBUs on two important dimensions: the attractiveness of the SBU's market or industry;
and the strength of the SBU's position in that market or industry.
• The best-known portfolio-planning methods are from the Boston Consulting Group, a leading management consulting firm, and by General
Electric and Shell.
•
•
THE BOSTON CONSULTING GROUP
BCG MATRIX CONT

• Using the Boston Consulting Group (BCG) approach, a company

classifies all its SBUs according to the growth-share matrix shown
above.
• On the vertical axis,. market growth rate provides a measure of market
attractiveness.
• On the horizontal axis, relative market share serves as a measure of
company strength in the market. By dividing the growth share matrix
as indicated, four types of SBU can be distinguished
BCG CONT

• 1. Stars. Stars are high-growth, high-share businesses or products. They often need heavy
investment to finance their rapid growth. Eventually their growth will slow down, and they will
turn into cash cows,
• 2. Cash cows. Cash cows are low-growth, high-share businesses or products. These established
and successful SBUs need less investment to hold their market share. Thus they produce cash
that the company uses to pay its bills and to support other SBUs that need investment.
• 3. Question marks. Question marks are low-share business unit in high growth markets. They
require cash to hold their share, let alone increase it. Management has to think hard about
question marks - which ones they should build into stars and which ones they should phase out.
• 4. Dogs. Dogs are low-growth, low-share businesses and products. They may generate enough
cash to maintain themselves, but do not promise to be large sources of cash.
• What strategies an be applied for these SBUS?
PRODUCT GROWTH STRATEGIES

• Ansoff Matrix

• A tool managers use to help determine their strategic

direction.
• It focuses on the ways companies can grow through
increased sales opportunities.
• It looks at the product in relation to its market and help
managers to identify their potential business opportunities.
ANSOFF
MARKET PENETRATION

• This involves increasing market share within existing market segments.

• This can be achieved by selling more products/services to established
customers or by finding new customers within existing markets.
• Market Penetration seeks to achieve four main objectives
• Maintain or increase the market share, this can be achieved by a
combination of competitive pricing strategies, advertising, sales
promotion and perhaps more resources dedicated to personal selling
MARKET PENETRATION CONT

• Restructure a mature market by driving out competitors,

this would require a more aggressive promotional
campaign supported by a pricing strategy designed to
make the market unattractive for competitors
• Increase usage by existing customers for example
introducing loyalty schemes
• Secure dominance of growth markets.
PRODUCT DEVELOPMENT

• This involves developing new products for existing

markets.
• Product development involves thinking about how
new products can meet customer needs more
closely and outperform the products of competitors.
• This is achieved through Research and development
MARKET DEVELOPMENT

• This strategy entails finding new markets for existing products. Market
research and further segmentation of markets helps to identify new
groups of customers.
• Finding new geographical markets eg exporting the product to a new
country
• Coming up with new product dimensions or packaging
• New distribution channels eg moving from selling via retail to selling
using e-commerce and mail order
• Different pricing policies to attract different or create new market
segments
DIVERSIFICATION

• This involves moving new products into new markets at the

same time.
• It is the most risky strategy.
• The more an organisation moves away from what it has
done in the past the more uncertainties are created.
• However, if existing activities are threatened,
diversification helps to spread the risk
MARKETING STRATEGY

• Target consumers are at the centre of the marketing strategy.

• The company identifies the total market, divides it into smaller
segments, selects the most promising segments and focuses on
serving them.
• It designs a marketing mix using mechanisms under its control:
product, price, place and promotion.
• The company engages in marketing analysis, planning,
implementation and control to find the best marketing mix and to take
action.
• The company uses these activities to enable it to watch and adapt to
the marketing environment
TARGET CONSUMERS

• To succeed in today's competitive marketplace, companies must be customer centred -

winning customers from competitors by delivering greater value.
• However, before it can satisfy consumers, a company must first understand their needs and
wants.
• There are too many kinds of consumer with too many kinds of need, and some companies
are in a better position to serve certain segments of the market.
• As a consequence, each company must divide the total market, choose the best segments
and design strategies for profitably serving chosen segments better than its competitors do.
• This process involves five steps: demand measurement and forecasting, market
segmentation, market targeting, market positioning and competitive positioning.
THE COMPETITIVE. ENVIRONMENT

• Companies aim to serve their customers, but they must do

so in an environment with many other Influences.
• At the widest level is the macro environment of Political,
Economic, Social and Technological (PEST) influences that
all organizations face.
• Besides this companies also face a unique micro
environment, including suppliers, competitors, channels of
distribution and publics - such as employees and the media
- that are not necessarily customers.
DEMAND MEASUREMENT AND
FORECASTING
• Suppose a company is looking at possible markets for : potential new product.
• First, the company needs to estimate the current and future size of the
market and its segments.
• To estimate current market size, the company would identify all competing
products, estimate the current sales of these products, and determine
whether the market is large enough to support another product profitably
that show strong growth prospects.
• Growth potential may depend on the growth rate of certain age, income and
nationality groups that use the product. Growth may also relate to larger
developments in the environment, such as economic conditions, the crime
rate and lifestyle changes.
MARKET SEGMENTATION

• If the demand forecast looks good, the company next decides how to enter the
market. The market consists of many types of customers, products and needs,
• The marketer has to determine which segments offer the best opportunity for
achieving company objectives.
• Consumers are grouped in various ways based on geographic factors
(countries, regions, cities); demographic factors (sex, age,income, education);
psychographic factors (social classes, lifestyles); and behavioral factors
(purchase occasions, benefits sought, usage rates).
• The process of dividing a market into groups of buyers with different needs,
characteristics or behavior, who might require separate products or marketing
mixes, is market segmentation
MARKET TARGETING

• After a company has defined market segments, it can enter one or many segments of a given market.
• Market targeting involves evaluating each market segment's attractiveness and selecting one or more
segments to enter.
• A company should target segments in which it has a differential advantage over its competitors;
where it can generate the greatest customer value and sustain it over time.
• A company with limited resources might decide to serve only one or a few special segments; this
strategy limits sales, but can be very profitable, alternatively, a company might choose to serve
several related segments - perhaps those with different kinds of customer, but with the same basic
wants.
• Or perhaps a large company might decide to offer a complete range of products to serve all market
segments.
• Most companies enter a new market by serving a single segment, and if this proves successful, they
add segments. Large companies eventually seek full market coverage
•
POSITIONING

• After a company has decided which market segments to enter, it must decide
what 'position' it wants to occupy in those segments. A product's position is the
place the product occupies in consumers' minds.
• If a product were perceived to be exactly like another product on the market,
consumers would have no reason to buy it. Market positioning gives a product a
clear, distinctive and desirable place in the minds of target consumers compared
with competing products.
• Marketers plan positions that distinguish their products from competing brands
and give them the greatest strategic advantage in their target markets
POSITIONING CONT

• In positioning its product, the company first identifies possible competitive

advantages upon which to build the position.
• To gain competitive advantage, the company must offer greater value to
chosen target segments, either by charging lower prices than competitors
or by offering more benefits to justify higher prices.
• However, if the company positions the product as offering greater value,
it must deliver greater value.
• Effective positioning begins with actually differentiating the company's
marketing offer so that it gives consumers more value than is offered by
the competition.
MARKETING STRATEGIES FOR COMPETITIVE ADVANTAGE

• The company must consider its size and industry position, then decide how to
position itself to gain the strongest possible competitive advantage.
• The design of competitive marketing strategies begins with competitor analysis.
• The company must formally or informally monitor the competitive environment to
answer these and other important questions: Who are our competitors? What are
their objectives and strategies?
• What are their strengths and weaknesses? How will they react to different
competitive strategies we might use? Which competitive marketing strategy a
company adopts depends on its industry position.
•
MARKETING STRATEGIES FOR
COMPETITIVE ADVANTAGE CONT
• Developing the Marketing Mix
• Once the company has chosen its overall competitive marketing strategy, it is
ready to begin planning the details of the marketing mix.
• The marketing mix is one of the dominant ideas in modern marketing. We
define marketing mix as the set of controllable tactical marketing tools that
the firm blends to produce the response it wants in the target market.
• The marketing mix consists of everything the firm can do to influence the
demand for its product. The many possibilities gather into four groups of
variables known as the 'four Ps'; product, price, place and promotion.
MARKETING PLAN

Executive Summary Presents a quick overview of the plan for management

review.

Current Marketing Situation The marketing audit that presents background data on the

Market, product, competition, and

distribution

SWOT analysis identifies the company’s main strengths and weaknesses and the
Main opportunities and threats
facing the product

Objectives and Issues Defines the company’s objectives in the area of sales, market
share and profits and issues that will affect these objectives

Marketing Strategy Presents the broad marketing approach that will be used
To achieve the plan’s objectives

Action Programs Specifies what will be done or when it will be done and what it will
cost
Budgets A projected profit and loss statement that forecasts the expected
Financial outcomes from the plan

Controls Indicates how the progress of the plan will be monitored

MARKETING INFORMATION SYSTEM

• Composed of

• Internal records sales data, customer information, internal

reports
• Marketing research – specific studies and data collection
• Marketing Intelligence – market trends, competitor analysis
• Decision Support Systems – tools to help managers make
informed decisions
THE MARKETING RESEARCH PROCESS

• Step 1: Problem Definition/ opportunity

• Step 2: Development of an Approach to the Problem

• Step 3: Research Design Formulation
• Step 4: Field Work or Data Collection
• Step 5: Data Preparation and Analysis
PROBLEM DEFINITION

• The first step in any marketing research project is to define the

problem.
• In defining the problem, the researcher should take into account the
purpose of the study, the relevant background information, what
information is needed, and how it will be used in decision making.
• Problem definition involves discussion with the decision makers,
interviews with industry experts, analysis of secondary data, and,
perhaps, some qualitative research, such as focus groups.
• Once the problem has been precisely defined, the research can be
designed and conducted properly
DEVELOPMENT OF AN APPROACH TO THE
PROBLEM

• Development of an approach to the problem includes

formulating an objective or theoretical framework, analytical
models, research questions, hypotheses, and identifying
characteristics or factors that can influence the research
design.
• This process is guided by discussions with management and
industry experts, case studies and simulations, analysis of
secondary data, qualitative research and pragmatic
considerations
RESEARCH DESIGN FORMULATION

• A research design is a framework or blueprint for conducting the marketing research

project.
• It details the procedures necessary for obtaining the required information, and its
purpose is to design a study that will test the hypotheses of interest, determine
possible answers to the research questions, and provide the information needed for
decision making.
• Conducting exploratory research, precisely defining the variables, and designing
appropriate scales to measure them are also a part of the research design.
• The issue of how the data should be obtained from the respondents (for example,
by conducting a survey or an experiment) must be addressed. It is also necessary to
design a questionnaire and a sampling plan to select respondents for the study.
RESEARCH DESIGN FORMULATION CONT

• More formally, formulating the research design involves the following

steps
• Secondary data analysis
• Qualitative research
• Methods of collecting quantitative data (survey, observation, and
experimentation)
• Definition of the information needed
• Measurement and scaling procedures
• Questionnaire design
• Sampling process and sample size
FIELD WORK OR DATA COLLECTION

• Data collection involves a field force or staff that operates

either in the field, as in the case of personal interviewing
(in-home, mall intercept, or computer-assisted personal
interviewing), from an office by telephone (telephone or
computer-assisted telephone interviewing), or through mail
(traditional mail and mail panel surveys with prerecruited
households).
• Proper selection, training, supervision, and evaluation of
the field force help minimize data-collection errors.
DATA PREPARATION AND ANALYSIS

• Data preparation includes the editing, coding, transcription, and

verification of data. Each questionnaire or observation form is inspected,
or edited, and, if necessary, corrected.
• Number or letter codes are assigned to represent each response to each
question in the questionnaire.
• The data from the questionnaires are transcribed or key-punched on to
magnetic tape, or disks or input directly into the computer.
• Verification ensures that the data from the original questionnaires have
been accurately transcribed, while data analysis, guided by the plan of
data analysis, gives meaning to the data that have been collected
MARKET SEGMENTATION

• Markets consist of buyers, and buyers differ in one

or more ways.
• They may differ in their wants, resources,
locations, buying attitudes and buying practices.
Through market segmentation, companies divide
large, heterogeneous markets into smaller
segments that can be reached more efficiently
with products and services that match their unique
needs
MARKET SEGMENTATION CONT
 LEVELS OF MARKET SEGMENTATION

• market segmentation can be carried out at many different levels.

Companies can practise no segmentation (mass marketing), complete
segmentation (micromarketing) or something in between (segment
marketing or niche marketing).
•
MASS MARKETING

• Mass marketing ,Using almost the same product, promotion and distribution for all
consumers.
• Companies have not always practised target marketing. In fact, for most of the
twentieth century, major consumer-products companies held fast to mass marketing -
mass producing, mass distributing and mass promoting about the same product in about
the same way to all consumers. Henry Ford epitomized this marketing strategy when he
offered the Model T Ford to all buyers; they could have the car 'in any colour as long as
it is black'. That cost Ford the world market leadership that it has never regained.
• The traditional argument for mass marketing is that it creates the largest potential
market, which leads to the lowest costs, which in turn can translate into either lower
prices or higher margins. However, many factors now make mass marketing more
difficult.
SEGMENTING MARKETS

• A company that practises segment marketing recognizes that buyers

differ in their needs, perceptions and buying behaviours. The company
tries to isolate micromarketing. Micromarketing is the practice of
tailoring products and
• marketing programmes to suit the tastes of specific individuals and
locations. Micromarketing includes local marketing and individual
marketing.
LOCAL MARKETING.

• Local marketing involves tailoring brands and promotions to the needs and wants of local customer
groups - cities, neighbourhoods and even specific stores.
• Local marketing has some drawbacks. It can drive up manufacturing and marketing costs by
reducing economies of scale. It can also create logistical problemsas companies try to meet the
varied requirements of different regional and local markets.
• Brand's overall image may be diluted if the product and message vary in different localities. Still, as
companies face increasingly fragmented markets, and as new supporting technologies develop, the
advantages of local marketing often outweigh the drawbacks.
• Local marketing helps a company to market more effectively in the face of pronounced regional and
local differences in community demographies and lifestyles. It also meets the needs of the
company's 'first-line customers' - retailers — who prefer more fine-tuned product assortments for
their neighbourhoods.
INDIVIDUAL MARKETING

• In the extreme, micromarketing becomes

individual marketing tailoring products and
marketing programmes to the needs and
preferences of individual customers.
• Individual marketing has also been labelled
'markets-of-one marketing', 'customized
marketing' and 'one-to-one marketing'
SEGMENTING CONSUMER MARKETS

• There is no single way to segment a market.

• A marketer has to try different segmentation variables,
alone and in combination.
• The major variables used in segmenting consumer markets.
• Here we look at the major geographic, demographic
psychographic and behavioral variables.
•
GEOGRAPHIC SEGMENTATION

• Geographic segmentation calls for dividing the market into different

geographical units, such as nations, states, regions, counties, cities or
neighbourhoods.
• A company may decide to operate in one or a few geographical areas,
or to operate in all areas but pay attention to geographical differences
in needs and wants.
• Many companies today have regional marketing programmes within
national boundaries - localizing their products, advertising, promotion
and sales efforts to fit the needs of individual regions, cities and even
neighbourhoods.
DEMOGRAPHIC SEGMENTATION

• Demographic segmentation consists of dividing the market into groups based

on variables such as age, gender, family size, family life cycle, income,
occupation, education, religion, race and nationality.
• Demographic factors are the most popular bases for segmenting customer
groups.
• One reason is that consumer needs, wants and usage rates often vary closely
with demographic variables
• . Another is that demographic variables are easier to measure than most other
types of variable.
• Even when market segments are first defined using other bases - such as
personality or behaviour - their demographics need knowing to assess the size
of the target market and to reach it efficiently.
PSYCHOGRAPHIC SEGMENTATION

• Psychographic segmentation divides buyers into groups based on social class, lifestyle or
personality characteristics. People in the same demographic group can have very different
psychographic make-ups.
• SOCIAL CLASS. Social classes affect preferences in cars, clothes, home furnishings, leisure
activities, reading habits and retailers. Many companies design products or services for specific
social classes, building in features that appeal to them.
• LIFESTYLE-people's interest in goods is affected by their lifestyles. Reciprocally, the goods they buy
express their lifestyles. Marketers are increasingly segmenting their markets by consumer lifestyles
• PERSONALITY. Marketers have also used personality variables to segment markets, giving their
products personalities that correspond to consumer personalities. Successful market segmentation
strategies based on personality work for products such as cosmetics, cigarettes, insurance and
alcohol
BEHAVIOURAL SEGMENTATION

• Behavioural segmentation divides buyers into groups based on their knowledge,

attitudes, uses or responses to a product. Many marketers believe that behavior
variables are the best starting point for building market segments.
• OCCASIONS. Buyers can be grouped according to occasions when they get the idea to
buy, make their purchase or use the purchased item. Occasion segmentation can help
firms build up product usage. For example, most people drink orange juice at breakfast,
but orange growers have promoted drinking orange juice as a cool and refreshing drink
at other times of the day. Mother's Day and Father's Day are promoted to increase the
sale of confectionery, flowers, cards and other gifts
• BENEFITS SOUGHT. A powerful form of segmentation is to group buyers according to the
different benefits that they seek from the product Benefit eg tooth paste….
• USER STATUS. Some markets segment into non-users, ex-users, potential users, first-
time users and regular users of a product. Potential users and regular users may require
different kinds of marketing appeal.
BEHAVIOURAL SEGMENTATION

• USAGE RATE. Some markets also segment into light, medium and heavy-user groups. Heavy users are
often a small percentage of the market, but account for a high percentage of total buying
• Airlines' frequent flyer programs are aimed at heavy users who, because they are business travelers,
also buy expensive tickets. British Airways Executive Club blue card members get free Air Miles each
time they travel and other priority benefits when booking and checking in. As usage mounts, Club
members are upgraded to silver and gold cards, each giving extra benefits and services. Almost all
airlines offer similar incentives, but since benefits mount with usage, it pays the frequent flyer to be loyal
• BUYER-READINESS STAGE. A market consists of people in different buyer readiness stages of readiness
to buy a product. Some people are unaware of the product; some are aware; some arc informed; some
are interested; some want the product; and some intend to buy. The relative numbers at each stage
make a big difference in designing the marketing programme
• ATTITUDE TOWARDS PRODUCT- People in a market can be enthusiastic, positive, indifferent, negative or
hostile about a product. Door-to-door workers in a political campaign use a given voter's attitude to
determine how much time to spend with that voter.
REQUIREMENTS FOR EFFECTIVE SEGMENTATION

• Clearly, there are many ways to segment a market, but not all segmentations are effective
• Measurable: The size, purchasing power, and profiles of the segments can be measured. Certain
segmentation variables are difficult to measure. eg keeping a data base of left handed people
• Accessible: The market segments can be effectively reached and served
• Substantial: The market segments are large or profitable enough to serve. A segment should be
the largest possible homogeneous group worth pursuing with a tailored marketing program. It
would not pay, for example, for an automobile manufacturer to develop cars especially for people
whose height is greater than seven feet.
• Differentiable: The segments are conceptually distinguishable and respond differently to different
marketing mix elements and programs. If men and women respond similarly to marketing efforts
for soft drinks, they do not constitute separate segments.
• • Actionable: Effective programs can be designed for attracting and serving the segments. For
example, although one small airline identified seven market segments, its staff was too small to
develop separate marketing programs for each segment.
MARKET TARGETING

• Marketing segmentation reveals the firm's market-segment opportunities. The firm now
has to evaluate the various segments and decide how many and which ones to target. At
this point we will look at how companies evaluate and select target segments.

• Evaluating Market Segments

• In evaluating different market segments, a firm must look at two dimensions; segment
attractiveness and company fit.

• Segment Attractiveness

• The company must first collect and analyze data on current sales value, projected sales-
growth rates and expected profit margins for the various segments. Segments with the
right size and growth characteristics are interesting. But 'right size and growth' are
relative matters. Some companies will want to target segments with large current sales, a
high growth rate and a high profit margin.
TARGETING

• The company must examine several significant structural factors that affect long-run segment attractiveness For
example, the company should assess current and potential competitors. A segment is less attractive if it
already contains many strong and aggressive competitors. Marketers also should consider the threat of
substitute products.
• A segment is less attractive if there are actual or potential substitutes for the product already exist.
• The relative power of buyers also affects segment attractiveness.
• A segment is less attractive if the suppliers of raw materials, equipment, labour and services in the
segment are powerful enough to raise prices or reduce the quality or quantity of ordered goods and
services.
• Suppliers tend to be powerful when they are large and concentrated, when few substitutes exist, or when
the supplied product is an important input
• Business Strengths
• Even if a segment has the right size and growth and is structurally attractive, the company must consider
its objectives and resources for that segment. It is best to discard some attractive segments quickly
because they do not match with the company's long-run objectives.
TARGETING CONT

• A target market consists of a set of buyers who share

common needs or characteristics that the company decides
to serve.
• The firm can adopt one of three market-coverage strategies:
• undifferentiated marketing,
• differentiated marketing and
• concentrated marketing
TARGET MARKETING CONT

• * Undifferentiated Marketing
• A market-coverage strategy in 'which a firm decides to ignore market segment
differences and
• go after the whole marker 'with one offer
• Differentiated marketing
• A market-coverage strategy in which a firm decides to target several market segments
and designs separate offers for each.
• Concentrated marketing
• A market-coverage strategy in which a firm goes after a large share of one or a few
submarkets.
•
CHOOSING A MARKET-(COVERAGE
STRATEGY
• Many factors need considering when choosing a market-coverage strategy.
• The best strategy depends on company resources. Concentrated marketing makes sense for a firm with
limited resources.
• The best strategy also depends on the degree of product variability. Undifferentiated marketing is suitable
for uniform products such as grapefruit or steel. Products that can vary in design, such as cameras and cars,
require differentiation or concentration. Consider the product's stage in the life cycle. When a firm introduces
a new product, it is practical
• to launch only one version, and undifferentiated marketing or concentrated marketing therefore makes the
most sense. In the mature stage of the product life cycle, however, differentiated marketing begins to make
more sense.
• Another factor is market variability. Undifferentiated marketing is appropriate when buyers have the same
tastes, buy the same amounts and react in the same way to marketing efforts.
• Finally, competitors' marketing strategies are important. When competitors use segmentation,
undifferentiated marketing can be suicidal. Conversely, when competitors use undifferentiated marketing, a
firm can gain by using differentiated or concentrated marketing.
POSITIONING

• A product's position is the way the product is defined by consumers on important attributes - the place the
product occupies in consumers' minds relative to competing products.
• Consumers position products with or without the help of marketers. But marketers do not want to leave
their products' positions to chance. They plan positions that will give their products the greatest
advantage in selected target markets, and they design marketing mixes to create these planned positions.
• Positioning starts with a product, a piece of merchandise, a service, a company, an institution or even a
person ... But positioning is not about what you do to a product.
• Positioning is what you do to the mind of the prospect. That is, you position products in the mind of the
prospect They argue that current products generally have a position in the minds of consumers.
• Thus Rolex is thought of as the world's top watch, Coca-Cola as the world's largest soft-drink company,
Porsche as one of the world's best sports cars, and so on. These brands own those positions and it would
be hard for a
• competitor to steal them.
•
THE MARKETING MIX STRATEGIES

• Product
• Promotion
• Price
• Place
• People
• Physical evidence
• Process
PRODUCT

• consumption that might satisfy a need or a want.

• Products include more than just tangible objects such as
cars, computers, or
• The products also include services, events, persons, places
etc
•
LEVELS OF PRODUCTS AND SERVICES
CORE PRODUCT

• This is the basic product and represents the main benefits for which the
product is purchased for in the first place
• The core product usually provides the same benefits as competing
products in the same category so there is little differentiation at this
stage.
• core level represents the product category, in that it would give a clear
description of what the purpose of the product is and what product
category would fulfil this purpose
• For example all car models such as Nissan, Toyota, Mazda, Ford etc
provide transport for people and luggage
GENERIC PRODUCT

• the Generic Stage of the Product level concept comprises of the sub-
categories that represent main product category.
• These sub-categories denote the variants that are available in that
particular product category.
• In our quoted example, where the motor vehicles epitomizes the main
product category, the various sub-categories would include different
kinds of cars like sport utility vehicles, trucks, buses, sedans, hatch
backs etc or it could even represent the various motor vehicle
manufacturing firms like Mazda, Toyota, Nissan, Ford, Subaru etc
EXPECTED PRODUCT/ TANGIBLE PRODUCT

• is about translating the list of core product benefits into a product that people will buy.
• There may be competitor products offering the same benefits so the aim at this stage is to
design a product that will persuade people to purchase your product.
• Kotler states that this can involve deciding on the quality level, product and service features,
styling, branding and packaging.
• For example Apple's iPhone design has enabled it to become a smart phone market leader so
that by September 2012 it was able to launch the iPhone 5, the 5th version of this product.
• There are other smart phones on the market but Apple has managed to design a product
which people pre-order and camp overnight outside Apple's retail stores so that they can be
the first ones to buy the product.
• Mercedes benz is renowned for its fast, strong cars with high engineering precision
• Toyota is renowed for its fuel efficient and low running costs vehicles
AUGMENTED PRODUCT

• It involves deciding the additional non tangible benefits that a product can
offer.
• Competition at this level is based around after sales service, help lines,
warranties, free/cheap delivery and so on.
• In other words it is things that the product does not do but customers may find
them useful.
• Non tangible benefits such as product warranties offer customers peace of
mind and demonstrate the manufacturer has faith in the quality of its product
•
POTENTIAL PRODUCT

• It is all the augmentations and transformations a product might

undergo in the future.
• future cars
• Specs for future cars
• Self parking technologies, driverless cars, electrical and hyrogen
powered cars, car to car communication,
PRODUCTS AND SERVICE
CLASSIFICATIONS
• Types of products
• Products and services fall into broad classes based on the type of
consumers that use them: consumer’s products and Industrial Products
• Consumer products- are products and services bought by final
consumers for personal consumption
CONSUMER PRODUCTS

• Consumer Products include the following:

• Convenience Products
• Shopping Products
• Specialty products
• Unsought products
CONVENIENCE PRODUCTS

• Convenience Products
• Products which consumers frequently purchase, Convenience products are usually low priced and marketers
place them in many locations to make them readily available when the customer need or want them. They maybe
• (i )a staple product
• Products bought routinely without much thought. These include products such s bread, milk, meali meal ,
products used almost every day, almost in every household, Habitual, low effort, frequent purchases, and low
involvement
• (ii)Impulse products
• Purchased without any planning or search efforts
• Customers just buy the product on sight eg chocolates, crisps etc
• Displayed at POS (usually bought quickly)
• (iii)Emergency Products
• Goods purchased when it’s urgent or great.
• Price of the product will not be important at the time of need eg raincoats- thunder begins. Ambulance service-
an accident occurs and protector plus.....
SHOPPING PRODUCTS

• Are less frequently purchased consumer products and services that

consumers compare carefully on suitability, quality, price, and style.
• When buying shopping products and services, consumers spend much
time and effort in gathering information and making comparisons
• Examples include furniture, clothing, used cars, major appliances and
hotel and airline services
• Shopping products marketers usually distribute their products through
fewer products but provide deeper sales support to help customers in
their comparison efforts
SPECIALTY PRODUCTS

• A product with one or more unique characteristics that a group of buyers is willing
to spend considerable time and effort to purchase
• Consumers carefully plan the purchase of the product because they know exactly
what they want and will not accept a substitute.
• Consumers don’t evaluate alternatives when searching for such a product.
• They are extremely brand loyal and concerned primarily with finding with the pre-
selected product available.
• Examples include specific brands of cars, high priced photography equipment,
designer clothes, medical or legal specialists
• Buyers normally do not compare specialty products; they invest only time needed
to reach dealers carrying the wanted products.
UNSOUGHT PRODUCTS

• Unsought products are consumer products that the consumer either

does not know about or knows about but does not normally consider
buying
• Most major new innovations are unsought until the consumer becomes
aware of them through advertising.
• Classic examples of known but unsought products and services are life
insurance, pre-planned funeral services and blood donations to the Red
Cross, by their very nature unsought products require a lot of
advertising, personal selling and other marketing efforts
INDUSTRIAL PRODUCTS

• These are products that are bought for use in the production of other products
or in an organisational operation
• They are also referred to as products bought for resale an they fall under the
following categories:
• Raw materials
• These are unprocessed items such as iron ore, logs, crops which are moved to
the next production process with little handling
• They become part of the finished good
• There are two types of raw materials- Agricultural products and natural
products
•
INDUSTRIAL PRODUCTS CONT

• Capital equipment
• Refers to large tools and machines used in the production process and operation of the firm
• Capital equipment is often expensive and intended to be used for a long period of time e.g. machinery
and tools
• Accessory equipment
• Used in production and office activities but doesn’t become part of the final physical product being
manufactured eg hand tools, computers etc
• Component parts
• It is a finished item that needs little processing before becoming part of a finished product eg tyres
• Although they are used in the manufacture of large products they are easily distinguishable from those
products e.g wire, plastics or
PRODUCT AND SERVICE ATTRIBUTES

• Product Quality
• Product features
• Product Style and Design
• Branding
• Packaging
• Labelling
• Product support services
PRODUCT QUALITY

• It is one of the marketer’s major positioning tools. Quality has a direct impact or product
or service performance, thus it is closely linked to customer value and satisfaction.
• Quality affects product or service performance, thus it is closely linked to customer
value and satisfaction
• Narrowly it can be defined as freedom from defects
• Most Marketers go beyond this narrow definition
• American Society for quality defines quality as the characteristics of a product or a
service that bears on its ability to satisfy a stated or implied customer needs.
• Total Quality Management (TQM)
• TQM is an approach in which all of the company’s people are involved in constantly
improving the quality of products, services and business processes.
PRODUCT FEATURES

• A product can be offered with varying features.

• A company can create higher level models by adding more features.
• Features are a competitive tool for differentiating company’s products
from competitors.
• Being the first producer to introduce a valued new feature is one of the
most effective ways to compete.
PRODUCT STYLE AND DESIGN

• Another way to add customer value is through distinctive product style

and design. Design is a larger concept than style. Style simply
describes the appearance of a product
• Styles can be eye catching. A sensational style may grab attention
and produce pleasing aesthetics but it does not necessarily make the
product perform better
• Unlike style- Design is more than skin deep-it goes to the very heart of
the product.
• Good design contributes to a product’s usefulness as well as its looks
BRANDING

• A product is also branded, A brand is a name, term, symbol, design or a

combination of these that identify the products or services of one seller
or group of sellers and differentiates them from those of sellers.
• Consumers view a product as an important part of the product and
branding can add value to a consumers purchase.
• Customers attach meanings to brands and develop brand relationships
• As a result brands have meaning well beyond a product’s physical
attributes
PACKAGING

• A product is also packaged. Packaging involves designing and

producing the container or wrapper for a product.
• Traditionally the primary function of a package was to hold and protect
the product, in recent times, however numerous factors have made
packaging an important marketing tool as well, it’s also being used for
attracting attention, describing the product to make the sale. Packaging
has become an important marketing tool.
LABELLING

• Labels range from simple tags attached to products to complex graphics that
are part of the packaging. They perform several functions-
• It identifies the product or the brand
• It describes several things about the product- who made it, where was it
made, when it was made, its contents, how it was used and how to use it
safely
• Labels and brand logs can support the brand’s positioning and personality.
• Finally the label might help promote the brand, support its positioning and
connect with customers.
•
PRODUCT SUPPORT SERVICES

• Customer Service is another element of product strategy. A company’s

offer usually includes some support services which can be a minor or
major part of the total offering
NEW PRODUCT DEVELOPMENT

• Idea generation
• Idea screening
• Concept development and testing
• Marketing Strategy Development
• Business Analysis
• Product Development
• . Test Marketing
• . Commercialization
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, but
also contributions from employees.
• 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. The
most important external source are customers, because the new product
development process should focus on creating customer value.
•
IDEA SCREENING

• Process to spot good ideas and drop poor ones as soon as possible.
• Many companies have systems for rating and screening ideas which
estimate:
• Market Size
• Product Price
• Development Time & Costs
• Manufacturing Costs
• Rate of Return
• Then, the idea is evaluated against a set of general company criteria.
IDEA SCREENING CONT

• Step 2. Idea Screening

• Another way of new product idea screening framework asks three questions

• 1st Is it real- is there a real need and desire for the product and will the customers buy it.

• Is there a clear product concept and will such a product satisfy a market.

•
Step 2. Idea Screening

• Second can we win? Does the product offer a sustainable competitive advantage?

• Does the company have the resources to make such a product a success

• Finally is it worth doing?

• Does the product fit the company’s overall growth strategy.

• Does it offer sufficient profit potential

• The company should be able to answer yes to all the three questions
CONCEPT DEVELOPMENT AND TESTING

• [Link] Product Ideas into Alternative Product Concept

• [Link] Testing - Test the Product Concepts with Groups of
Target Customers
• 3. Choose the Best One
MARKETING STRATEGY DEVELOPMENT

• The marketing strategy statement consist of three parts

• 1st part describes the target market, the planned value proposition
and the sales, market share and profit goals for the 1st few years.
• 2nd part of the marketing strategy statement outlines the product’s
planned price, distribution and marketing budget for the first year.
• 3rd part of the marketing strategy statement describes the planned
long run sales profit goals and marketing mix strategy.
[Link] ANALYSIS

• Business Analysis
• Review of Product Sales, Costs, and Profits Projections to See if
They Meet Company Objectives
• 1. If No, Eliminate Product Concept
• 2. If Yes, Move to Product Development
PRODUCT DEVELOPMENT

• creating product specifications

• prototypes
STEP 7. TEST MARKETING

• Standard Test Market

• Full marketing campaign in a small number of representative
cities.
• Controlled Test Market
• A few stores that have agreed to carry New products for a fee
• Test Market
• Test in a simulated shopping environment to a sample of
consumers.
COMMERCIALIZATION

• Commercialization is the Introduction of the New Product into

the Marketplace
• When?
• Where?
• To whom ?
• How?
PRODUCT LIFE CYCLE

• A product has a life cycle in much the same way as a living organism e.g. people are
born, mature and die.

• By the same token products are introduced in the market and in terms of revenue they
grow and reach a decline stage at a later stage.

• Stages of Product Life Cycle

• Product life cycle comprises four stages:

• Introduction stage

• Growth stage

• Maturity stage

• Decline
PRODUCT LIFE CYCLE
INTRODUCTION STAGE

• When a new product is first launched profits are

negative or low because of low sales and high
distribution and promotion expenses.
• Much money is needed to attract distributors and
build their inventories
• Promotion spending is relatively high to inform
consumers of the new product and get to try it.
INTRODUCTION STAGE CONT

• The company and its few competitors produce basic versions of the product
• Product
Branding, Quality level and intellectual property and protections are obtained to stimulate consumers for
the entire product category. Product is under more consideration, as first impression is the last impression.
• Price
High(skim) pricing is used for making high profits with intention to cover initial cost in a short period and
low pricing is used to penetrate and gain the market share. Company choice of pricing strategy depends
on their goals.
• Place
Distribution at this stage is usually selective and scattered.
• Promotion
At introductory stage, promotion is done with intention to build brand awareness. Samples/trials are
provided that is fruitful in attracting early adopters and potential customers. Promotional programs are
more essential in this phase. It is as much important as to produce the product because it positions the
product
GROWTH STAGE

• If the new product satisfies the market it will enter the growth stage. Sales start to increase

• The early adopters will continue to buy

• New competitors will enter the market.

• Product
Along with maintaining the existing quality, new features and improvements in product quality may
be done. All this is done to compete and maintain the market share.

• Price
Price is maintained or may increase as company gets high demand at low competition or it may be
reduced to grasp more customers.
GROWTH STAGE CONT

• Distribution
Distribution becomes more significant with the increase demand and
acceptability of product. More channels are added for intensive
distribution in order to meet increasing demand. On the other hand
resellers start getting interested in the product, so trade discounts are
also minimal.
• Promotion
At growth stage, promotion is increased. When acceptability of
product increases, more efforts are made for brand preference and
loyalty
MATURITY STAGE

• This stage normally lasts longer than the previous stages.

• It is the stage in which a product’s growth slows or levels off.
• Competitors begin marking down prices increasing their advertising and sales
promotion
• These steps lead to a drop in profits
• Some of the weaker competitors start dropping out.
• Marketing mix decisions include:
• Product
At maturity stage, companies add features and modify the product in order to
compete in market and differentiate the product from competition. At this stage, it
is best way to get dominance over competitors and increase market share.
MATURITY STAGE CONT

• Price
Because of intense competition, at maturity stage, price is reduced in
order to compete. It attracts the price conscious segment and retain
the customers.
• Distribution
New channels are added to face intense competition and incentives are
offered to retailers to get shelf preference over competitors.
• Promotion
Promotion is done in order to create product differentiation and loyalty.
Incentives are also offered to attract more customers.
DECLINE STAGE

• Sales may decrease to zero or they may drop to a level where they
continue for many years.
• It may also be due technological advances or customer taste has been
changed.
• At decline stage company has three options:
• Maintain the product, Reduce cost and finding new uses of product.
• Harvest the product by reducing marketing cost and continue offering the
product to loyal niche until zero profit.

• Discontinue the product when there’s no profit or a successor is

available. Selling out to competitors who want to keep the product
DECLINE CONT

• At declining stage, marketing mix decisions depends on company’s

strategy.
• For example, if company wants to harvest, the product will remain
same and price will be reduced. In case of liquidation, supply will be
reduced dramatically.
LIMITATIONS OF PRODUCT LIFE CYCLE (PLC)

• Product life cycle is criticized that it has no empirical support and it is not
fruitful in special cases.
• Different products have different properties so their life cycles also vary.
• It shows that product life cycle is not best tool to predict the sales.
• Sometimes managerial decisions affect the life of products in this case
Product Life Cycle is not playing any role.
• Product life cycle is very fruitful for larger firms and corporations but it is
not hundred percent accurate tool to predict the life cycle and sales of
products in all the situations
PRODUCT LIFE CYCLE SUMMARY TABLE
Characteristic Introduction Growth Maturity Decline

Sales Low Rapidly increasing Peak in sales declining

Costs/ customer High Average Low Low

Profits Negative Rising High Declining
Type of customers Innovators Early adopters Early and late majority Laggards

Competitors Few Growing numbers Stable but declines at a Declining in number

later stage

Marketing objectives Create Product Maximising market share Maximised profit Reduce market costs
awareness and trial

Product strategies Basic Differentiated Differentiated Milk the brand or phase

out
Pricing Strategies Market scheming Penetration- charging Best matching price or Cut down price
low price price to beat the
competitors

Distribution Selective Wider Intensive Selective

Strategies
Promotion Strategies Aims at building Build awareness in the Maintain awareness and Reduce or eliminate
awareness mass market focus on brand
differences and benefits
PRICE

• Price is the amount of money charged for a product or a service-

Broadly it is the sum of all values that customers give to gain the
benefits of having or using a product or a service
• Price remains one of the most important elements that determines the
firm’s market share and profitability
• Price is the only element in the marketing mix that produces revenue,
all other elements represent costs
FACTORS CONSIDERED WHEN SETTING PRICE

• Costs
• objectives of the firm
• The Market and Demand
• Competition and nature of market
• Consumer perception of price and value
• competitor prizes
• regulations
THE MAJOR PRICING DECISIONS

• Customer Value Based-Pricing

• Value Added Pricing
• Cost based
• Competitor based
• Cost plus
CUSTOMER VALUE BASED-PRICING

• The company first assesses customer needs and value

perceptions.
• It then sets its target price based on customer perceptions
of value.
• The targeted value and price drive decisions about what
costs can be incurred and the resulting product design.
• As a result, pricing begins with analysing consumer needs
and value perceptions and price is set to match the
perceived value.
VALUE ADDED PRICING

• Rather than cutting prices to match competitors

they attach value added features and services to
differentiate their offers and thus support higher
prices.
COST BASED

• It involves setting prices based on their costs-

costs for producing, distributing and selling the
product plus a fair rate of return for its effort and
risk.
• Some companies with lower costs can set lower
prices that result in smaller margins but greater
sales and profits, other companies like Apple can
intentionally pay higher costs so that they can
claim higher prices and margins.
COMPETITION BASED PRICING

• Involves setting prices based on competitors strategies, costs and market offerings. Consumers will base their
judgements of a product’s value on the prices that competitors charge for similar products.
• In assessing competitors pricing strategies the company should ask several questions
• How does the companies pricing strategies compare with competitor’s offerings in terms of customer’s value ?
• If Consumers perceive that the company’s product or service provides greater value, the company can charge a higher
price.
• If consumers perceive that the company’s product or service provides greater value the company can charge higher
price.
• If consumers perceive less value the company can charge higher price.
• If consumers perceive less value relative to competing products, the company must either charge a lower price or
change customer perceptions to justify a higher price.
• How strong are competitors, what are their current pricing strategies?
• If a company faces a host of smaller competitors, charging high prices relative to the value they deliver, it might
charge lower prices to weaker competitors from the market. If the market is dominated by larger, low price
competitors the company may decide to target unserved niche markets with value added products at higher prices.
COST PLUS/ MARKUP PRICING

• Adding a standard mark-up to the cost of the product

• Variable costs + Fixed costs up to the cost of the product.
• Breakeven Analysis and Target profit Pricing
• Setting price to breakeven on the costs of making and marketing a product or
setting price to make a target turn
NEW PRODUCT PRIZING STRATEGIES

• Market Skimming
• Many companies that invent new products set high initial prices ‘to skim’
revenues layer from the market. Apple frequently applies this strategy
• Market Penetration Pricing
• Rather than setting a high initial price to skim off small but profitable
market segments, some companies use market penetration pricing.
Companies set a low initial price to penetrate the market quickly and
deeply to attract a large number of buyers quickly and win a large market
share. The high sales volume results in falling costs, allowing companies to
cut prices even further.
PRODUCT MIX PRICING STRATEGIES

• Product Line Pricing

• Optional product Pricing
• Captive Product Pricing
• Product Bundle Price
PRODUCT LINE PRICING

• Companies usually develop product lines rather than single products

• In product line pricing, management must determine the price steps to
set between the various products in a line.
• The price steps should take into account cost differences between the
products in the line. More importantly they should account for
differences in customer perceptions of the value of different features
OPTIONAL PRODUCT PRICING

• Many companies use optional product pricing- offering to sell optional

or accessory products along with the main product e.g. a car buyer
may choose to order positioning systems (GPS) and Bluetooth wireless
communication.
CAPTIVE PRODUCT PRICING

• Setting a price for products that must be used

along with a main product such as blades for a
razor, games for a video game console.
• Producers of the main products, razors, video
game consoles, printers often price them low and
set high mark-ups in the supplies
PRODUCT BUNDLE PRICE

• Sellers often combine several products and offer

the bundle at a reduced price e.g. in restaurants
they bundle a burger, chips, soft drink at a combo
price
PRICE ADJUSTMENT STRATEGIES

• Discount and allowance Pricing

• Discount- a straight reduction in price on purchase during a stated period of time or of larger
quantities.
• Allowance- promotional money paid by manufacturers to retailers in return for an agreement to
feature the manufacturers products in some way.
• Segmented pricing
• Companies will often adjust their basic prices to allow for differences in customers, products,
and locations. In segmented pricing, the company sells a product or a service at two or more
prices, even though the difference in prices is not based on differences in costs.
• Psychological Pricing
• The customer's perception of your products' prices is the basis of psychological pricing. Instead
of appealing to the rational side of the consumer, this strategy appeals to their emotional side.
PRICE ADJUSTMENT STRATEGIES CONT

• Promotional
• Geographical
• International
• discrmininaory
• Premium
• economy
PROMOTION MIX STRATEGIES

• Advertising –
• Objectives- inform, remind and persuade
SETTING THE ADVERTISING BUDGET

• After determining its advertising objectives the company sets its advertising budget for each
product.
• This is allocating money and other resources to a product or company advertising program.
•
• Developing the advertising strategy
• This is the strategy by which the company accomplishes it advertising objectives.
• It consist of two major elements: creating adverting messages and selecting advertising
media.
• Message Strategy
• Creating the advertising message
• etc
SETTING THE ADVERTISING BUDGET
CONT
• Developing an effecting message strategy, beginning with identifying customer benefits, these can
be used as adverts appeals
• The message should be well executed, such as showing the lifestyle, fantasy, mood or image etc
• Selecting the media
• Major steps in advertising media selection are
• determining on reach, frequency and impact
• Choosing among major media life styles
• Selecting specific media vehicles and
• Choosing media timing- seasonal or on holidays
• Media types-Television, radio, newspapers, internet
• Evaluating Advertising Effectiveness and the return on advert investment
• Measuring the rate of return on advert investment
PUBLIC RELATIONS

• Building good relations with the government with the various publics by
obtaining favourable publicity, building up a good corporate image and
handling or heading off unfavourable rumours, stories and
departments. PR departments may perform any or all of the following
functions
• Press relations or press agency: creating and placing newsworthy
information in the news media to attract attention to a person or
service
• Product publicity- publicising specific products
• Public affairs- building and maintaining national and or local
communicating relationships.
THE MAJOR PUBLIC RELATIONS TOOLS

• News- creates favourable news about the company and its products or people.
• Speeches-
• Special events, news conferences, press tours, grand openings
• Written materials- annual reports, brochures, articles, company newsletter and
magazines
• Audio visual material-slide and sound programmes, dvds
• Corporate Identity materials- help to create corporate identity that the public
immediately recognises logos, brochures, stationery, business cards, buildings,
uniforms, company cars and trucks
PUBLIC RELATIONS PRONS AND CONS

• Advantages
• Creates a positive attitude towards a product or company.
• Enhances credibility of a product or company.
• Disadvantages
• May not permit accurate measurement of effect on sales
• Involves much effort directed toward non-marketing oriented goals
PERSONAL SELLING

• Personal presentation by the firm’s sales force for the purpose of

making sales and build customer relationships
• The people who do the selling are called: sales people, sales
representatives, agents, sales consultants etc
• Personal selling has the following characteristics
• Interactive
• Personal selling involves an immediate and interactive relationships
between two or more persons
PERSONAL SELLING ADVANTAGES AND
DISADVANTAGES
• Questions can be asked and responded too immediately

• Adaptable

• Presentations can be changed depending on the customer needs

• Personal selling makes the buyer feel under some obligation to listen to the sales person
eg Insurance Agents

• Permits measurement of effectiveness

• Elicits immediate response

• Tailors the message to fit the customer

• Disadvantages

• Relies almost exclusively upon the ability of the sales person

• Involves high cost per contact

SALES PROMOTION

• Short term incentives to encourage the purchase or sale of a product or service.

• Sales promotions mainly done to getting retailers to carry new products and
more inventory or promote the company’s products and give them more shelf
space, or getting the sales force to sign up new accounts.
• Incentives provide a quick boost of sales but however effects maybe in a short
term.
• Excessive use of incentives may damage brand image.
• Some incentives used in sales promotion includes discounts, demonstrations,
point of purchase display and competition. Eg Ok Grand Challenge
• It invites the rewards quick response as it says buy it now.
SALES PROMOTION PRONS AND CONS

• Advantages
• Produces an immediate consumer response
• Attracts attention and creates product awareness
• Allows easy measurement of results
• Provides short term sales increase
• Disadvantages
• Is non personal in nature.
• Is difficult to differentiate from competitors efforts.
EXHIBITIONS AND TRADE FAIRS

• These are organised by the government and the trade board. The
bodies also provide a chance to industrial goods manufactures to show
case their goods, e.g. Harare Agricultural Show, ZITF etc
DIRECT MARKETING

• Another element in a firm’s integrated promotional mix is direct marketing, the

use of direct communication to a consumer or business recipient to generate a
response in the form of an order (direct order) ,
• A request for further information (lead generation), or a visit to a place of
business to purchase specific goods or services (traffic generation) or
• A visit to a place of business to purchase specific goods or services (traffic
generation).
• Many people equate direct marketing with direct mail, this promotional
category also includes telephone marketing (tele marketing) direct response
advertising and infomercials on television and radio, direct response print
advertising, and electronic media.
DIRECT MARKETING CONT

• Advantages
• Generates an immediate response
• Allows complete customised personal messages
• Produces measurable results
• Disadvantages
• Involves a high cost per reader
• Depends on quality and accuracy of mailing list
• May annoy consumers
SOCIAL MEDIA

• WhatsApp
• Facebook
• Twitter
• LinkedIn
• YouTube
• Instagram
SOCIAL MEDIA CONTENT CREATION

• Involves
• Knowing the audience
• Content type – images, videos, stories, live streams, txt posts
• Content themes – promotions, education, entertainment, engagement
• Brand voice – consistent tone, language, personality
• Visual identity – consistent visuals, logos, branding
• Story telling- engaging narratives
• Relevance and timelines – posting relevant content at the right time
MEASURING SOCIAL MEDIA
EFFECTIVENESS
• Engagement rates - likes, comments, reactions
• Reach and impressions – content visibility, audience sizes
• Conversions – sales, leads, signs ups generation
• Return on investment – revenue generated vs expenditure
• Sentiment analysis – analysing customer opinions and
sentiments
PLACE/DISTRIBUTION

• Place refers to providing the product at a place which is convenient for

consumers to access. It is synonymous with distribution.
• Various strategies such as intensive distribution, selective distribution,
exclusive distribution and franchising can be used by the marketer to
complement the other aspects of the marketing mix.
THE IMPORTANCE OF DISTRIBUTION CHANNELS IN
MARKETING STRATEGY

• A distribution channel is a set of interdependent organizations that help make a

product available for use or consumption by the consumer or business user.
• Channel intermediaries are firms or individuals such as wholesalers, agents, brokers, or
retailers who help move a product from the producer to the consumer or business user.
• A company’s channel decisions directly affect every other marketing decision. Place
decisions, for example, affect pricing.
• Marketers that distribute products through mass merchandisers such as Wal-Mart will
have different pricing objectives and strategies than will those that sell to specialty
stores.
• Distribution decisions can sometimes give a product a distinct position in the market.
The choice of retailers and other intermediaries is strongly tied to the product itself
FUNCTIONS OF DISTRIBUTION CHANNELS

• Channels provide time, place, and ownership utility. They make

products available when, where, and in the sizes and quantities
that customers want.
• Distribution channels provide a number of logistics or physical
distribution functions that increase the efficiency of the flow of
goods from producer to customer.
• Distribution channels create efficiencies by reducing the
number of transactions necessary for goods to flow from many
different manufacturers to large numbers of customers.
DISTRIBUTION CHANNELS
THE END

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