Marketing develops products, prices them,

promotes them and then distributes

a process of planning and executing the: them in a way that helps a company
 Conception, create and sustain demand for their
 Pricing, products.
 Promotion, 4Ps of Marketing
 Distribution of ideas, goods, and services to
create exchanges that satisfy individual and  Product: The Product management and
organizational objectives. Product marketing aspects of marketing deal
with the specifications of the actual good or
service, and how it relates to the end-user's
Marketing Activities needs and wants.
 get attention
 motivate & encourage people  Pricing: This refers to the process of setting a
 facilitate them to act (buy) price for a product, including discounts.
 get them to buy again
 Promotion: This includes advertising, sales
Define your product/service promotion, publicity, and personal selling, and
Promotion / promoting refers to the various methods of promoting the
Distribute your product/service product, brand, or company.
Maintain a relationship
 Placement or distribution refers to how the
Building and nurturing a relationship product gets to the customer; for example,
Create, expand and maintain point of sale placement or retailing. This fourth
Understand consumer behavior P has also sometimes been called Place,
how people buy, what they buy, when they referring to the channel by which a product or
buy and why they buy service is sold (e.g. online vs. retail), which
geographic region or industry, to which
segment (young adults, families, business
 Customer focus (orientation):
people), etc.
 Customer wants1 are researched,
 The information is disseminated throughout
the firm and products are developed Advertising
 Customer satisfaction is monitored and Advertising is paid communication through a non-
adjustments made if necessary. personal medium in which the sponsor is
identified and the message is controlled.
3 Assumptions of Transactional Marketing
 There is a large number of potential Variations include:
customers  publicity & public relations
 Customers and their needs are fairly  product placement2 (plug on sitcom)
homogenous  sponsorship & underwriting spots 3 (e.g. PBS)
 It is rather easy to replace lost customers with  sales promotion
new on
Viral Marketing
3 Levels of Marketing viral advertising refer to marketing techniques
that use pre-existing social networks to produce
Corporate increases in brand awareness.
1. 'What business should we be in and
what opportunities should we Advantages:
pursue?' This is marketing before we  Ease of executing the marketing campaign,
even have a business, idea or product.
 Relative low-cost (compared to direct mail)
Business
2. 'How are we going to compete  Good targeting,
against the competition? 'Focused on  High and rapid response rate
the competition; deals with long term
sustainable advantages and business Mass Market vs. Niche Market
models
2
Functional a real commercial product is used in fictional or non-fictional
media, and the presence of the product is a result of an
3. 'How do we create and keep
economic exchange. When featuring a product is not part of
customers?'; '4ps' of the marketing mix. an economic exchange, it is called a product plug.
This level of marketing defines and 3
spots usually mention the name of the sponsor, and can
resemble traditional advertising in commercial broadcasting,
1 but there are usually legal restrictions, such as a prohibition of
determines what its potential customers desire making product claims, announcing prices, or providing an
incentive to buy a product or service.
Mass marketing is used to sell a product to a large variety of
customers in large amounts. Mass marketing is the opposite
of niche marketing, where a product is made especially for
one person or a group of person

Marketing Innovations & Theory:

exploit people's herd mentality to increase sales

Mass Customization (PERSONALIZATION)

 Adaptive customization - firms produce a

standardized product, but this product is Positioning Strategies:
customizable in the hands of the end-user
(the customers alter the product themselves)  Product Attributes: What are the specific
product attributes?
 Collaborative customization - talk to  Benefits: What are the benefits to the
individual customers to determine the precise customers?
offering that best serves the customer's  Usage Occasions: When / how can the
needs (personalized marketing and personal product be used?
marketing orientation). This information is  Users: Identify a class of users.
used to specify and manufacture a product  Against a Competitor: Positioned directly
that suits that specific customer against a competitor.
 Away from a Competitor: Positioned away
 Cosmetic customization - produce a from competitor.
standardized physical product, but market it  Product Classes: Compared to different
to different customers in unique ways. classes of products.

 Product/Service Differentiation Positioning Differences

differentiating it from competitors' products as
well as one's own product offerings  Important: The difference delivers a highly
valued benefit to the target buyers
Sources:  Distinctive: Competitors do not offer the
 Differences in quality or design among output difference, or the company can offer it in a
(product) more distinctive way
 Ignorance of buyers regarding the essential  Superior: The difference is superior to other
characteristics and qualities of goods they are ways that the customer might obtain the
purchasing same benefit
 Pervasive sales promotion activities of sellers  Communicable: The difference can be
and, in particular, advertising explained and communicated to the target
 Differentiation in the locations of sellers of the buyers
same good;  Preemptive: Competitors cannot easily copy
the difference
Product/Service Positioning  Affordable: Buyers can afford to pay the
How are you, your product/service perceived in the market difference
compared to the competition?
 Profitable: Company can introduce the
A good position is: difference profitably
1. What makes you unique
2. This is considered a benefit by your target Segmentation Variables:
market Main Segments (subsets)
 Geographic
 Re-positioning involves changing the identity  Demographic (age, gender, income,
of a product, relative to the identity of competing occupation, religion)
products  Psychographic (personality, value, attitude)
 Behavioral (benefit sought, brand loyalty)
 De-positioning involves attempting to
change the identity of competing products,
relative to the identity of your own product,  Who are the Innovators and Early
adopters?
Environment
1. What is our marketing environment?
2. What is our competitive advantage?
 Venturesomeness: the willingness and • Matching: fitting the offer to the buyer's
desire to be daring in trying something new needs
and different • Negotiation: reaching agreement on
 Social integration: frequent and extensive price and terms
contact with others in one’s area • Physical distribution: transporting and
 Cosmopolitan: point of view extending storing the goods
beyond the immediate neighborhood or • Financing: getting and using funds to
community cover the costs of channel work
 Social mobility: upward movement on the • Risk taking: assuming the risks the
social scale channel work.
 Privilegedness: attitude and possession of
money (less risky to try something new) Distribution
 Upselling • Retail
a marketing technique where the customer is • Online
offered a higher-priced version of a product or an • In Person
additional product to the original sale.
• In House

Pricing Strategies

 Product Line: Setting price steps between

product line items
 Optional Product: Pricing optional or
accessory products
 Captive Product: Pricing products that must
Target Market: be used with the main product
Each class has different risk tolerances.  By-Product: Pricing low value by product to
get rid of them
• Innovators4 First 5% - 10% that adopt the  Product Bundle: Pricing bundles of products
product sold together
• Early Adopters Next 10% - 15%
New Product Pricing Strategies
• Early Majority Next 30%
• Late Majority Next 30% Market-Skimming: Initially set high prices to "skim"
• Laggards Remaining 20% revenue layer by layer from the market. Works when:

Product Adaptability  Quality and image support the higher price

 Relative advantage of the product: How  Enough buyers want the product at that price
superior is the innovation to the product or  Cost of producing a small volume cannot be high
other problem-solving methods it was  Competitors should not be able to enter the market
designed to compete against? easily
 Compatibility: Does it fit with current
Market Penetration: Set a low initial price in order to
product usage and customer activity? penetrate the market quickly and deeply to win a large
 Complexity: Will difficulty or confusion arise market share. Works when:
in understanding the innovation’s basic idea?
 Divisibility: How easily can trial portions of  Market is highly price sensitive
the product be purchased?  Production and distribution costs fall as sales
 Communicability: How likely is the product volume increases
to appear in public places where it is easily  Low price must help keep out the competition
seen and studied by potential users?
Price Adjustment

Distribution Channels Functions  Discount & Allowance: reduced prices to reward

What is the purpose of a distribution channel? customer responses such as paying early or
promoting the product
 Discriminatory: adjusting prices to allow for
• Information: gathering and distributing
differences in customers, products, and locations
marketing research
 Psychological: adjusting prices for psychological
• Promotion: developing and effects. Ex: $299 vs. $300
communicating offers  Value: adjusting prices to offer the right
• Contact: communicating with prospective combination of quality and service at a fair price
buyers  Promotional: temporarily reducing prices to
4 increase short-run sales
 Geographical: adjusting prices to account for
geographic location of customer.
 International: adjusting prices in international
markets

Promotion

Promotion is the specific mix of advertising, personal

selling, sales promotion, and public relations a
company uses to pursue its advertising and marketing
objectives

 Shows
 Direct Mail
 Web Page
 Posters
 Event Listings
 Reviews
 Radio
 Word of Mouth
 Press Releases

 Evangelism Marketing or Word of Mouth

advanced form of word of mouth marketing
(WOMM) in which companies develop customers
who believe so strongly in a particular product or
service that they freely try to convince others to
buy and use it.

 Consumers have become increasingly media-

savvy, hard-sell advertising messages do not
function well

 Branded content - branded content

programs are able to blend the advertising
message in a seamless and transparent fashion,
while still getting the information across to the
consume