MARKETING

Introduction

Marketing 

Marketing as a social process: individuals obtain what they need and want through creating and exchanging products and values with others.

Marketing is wider and it includes:

Find out / anticipate what consumer wants, Demand management by:

- Developing product.
- Pricing and promoting.

Marketing people are involved in 10 types:

• Goods: physical outputs from different industries of a company.
• Service: intangible goods.
• Experience: a valuable asset for enhancing performance as it is versed with high knowledge and skills.
• Events: shows, sports events, artist performance, product presentation.
• Persons: celebrity marketing.
• Places: cities, regions.
• Properties: buildings, land …
• Organization: Ngo's, companies...
• Information:  newspapers, magazines, websites.
• Ideas: thoughts, concepts...

AMA( American marketing association): refers to the performance of business activities that direct the flow of goods and services from producer to consumer.

Cost terms/concepts in marketing:

 A need: is a state of feeling of some basic satisfaction.

 Wants: desires for specific objects that may satisfy a need.

 Demand: are wants for specific products backed by an ability to pay.

 A market is a collection of people sharing particular needs/wants to exchange.

Target market: is the segment of the market which a marketer attempt to serve because it presents the greatest opportunity.

 Segmentation is the act of dividing the entire market into different segments so that a marketer can be able to decide which the target market is.

  A marketer is a person that anticipates customers’ needs/wants and develops products to satisfy the need, price them, promote and distribute.

 A product: can be anything that can be offered to someone to satisfy a need or want.

 Exchange is the fact of obtaining the desired product from someone by offering something in return.

MARKETING RESEARCH

Introduction

Most organizations rely on research to inform and improve their decision making

Since resources are scarce, organizations should understand the needs and opinions of customers and other stakeholders

(This is where the value of research lies)

Research has the ability to provide high-quality information for planning and decision making 

Thus research allows:

• Better quality decision making
• Better use of resources
• Better products
• Better policies
• Better relationship with customers and other stakeholders

IS RESEARCH A COST OR INVESTMENT?

Evidently, organizations which spend more on research are more successful in the long run, thus; RESEARCH IS VIEWED AS AN INVESTMENT NOT COST

What is research?

It is a systematic investigation of information and study of materials, sources, etc in order to establish facts and reach new conclusions

In a most general sense, it simply searches of knowledge or truth

Research is the process of collection of information and data about the topic being studied

It is  a formal, systematic application of the scientific approach to the study of a problem to discover new information or expand and verify existing knowledge

research is founded on scientific methods, which are in turn supported by philosophical principles about nature and knowledge and how we construct the knowledge

WHAT IS MARKETING RESEARCH?

    Marketing research is the link between the marketer and the market…

It is the starting point of marketing…

Marketing research is the systematic design, collection, analysis, and reporting of data and findings relevant to a specific marketing situation facing the company.

MARKETING STRATEGY

How you project your image, how you make yourself appear different from your competitors, is with your marketing strategy, or what professional marketers call the MARKETING MIX.

The marketing mix is the particular combination of marketing elements that a business uses to find and satisfy its customers; the marketing strategy, usually describes in terms of its product/service, price, distribution, and promotion elements.

Marketing mix and marketing strategy means the same thing.

Over the years, a fairly standard method has evolved to explain a firm’s marketing mix, and this is probably the best way to describe it in your business plan. The marketing mix is typically broken down into the following elements:

Product or service strategy.

Pricing strategy.

Distribution strategy.

Promotion strategy.

The better you get to know your market, the more accurately you will be able to tailor your business to give customers what the want, what they really want, not the superficial or the impossible. Customers may seem to want the impossible: 

The lowest price.

Highest quality.

Best service.

Best terms.

Fastest delivery, but it can’t be done.

So you must develop a marketing strategy that will give the customers not everything, but those things that are most important to them.

    

 SEGMENTATION, POSITIONING, AND TARGETING

Conceptually, segmentation is the process of dividing the entire market into smaller groups sharing one or more characteristics that cause them to have similar product needs. Segmenting the market allows an entrepreneur to define consumer needs more precisely and that leads to the formation of more accurate marketing objectives. For a large firm, segmenting allows for the customization of marketing mixes focused on each segment, but for an entrepreneurial venture, segmenting allows you to segregate the market between your focus segment and all others. With small size and limited resources, it is not wise to pursue multiple segments. The entrepreneurial venture must concentrate all energies on a selected segment. At most, some other segments can be kept in mind as follow-up segments.

There are several ways of segmenting the market. The popular bases for segmentation are geographical location, age, gender, income, and ethnicity. Entrepreneurs may also use benefit segmentation, which seeks to group consumer on the basis of benefits they seek from the product.

While selecting the target segment, it is also important to answer the following questions that determine the attractiveness of the segment:

Can the segment be easily identified?

Is the segment big enough in terms of the potential revenue?

How easy it is to reach the segment with the positioning communication and with the product?

Positioning can be expressed in a statement that explains why a customer should buy you product rather than that of the competitors. It refers to the unique differentiating characteristics of the product as perceived by the target segment. A fundamental concept is that the positioning should concentrate on benefits and not in product features. 

PRICING

Many entrepreneurs feel that pricing is an easy decision to make. For most of them, the basis of pricing is usually costs or competitors' prices. This is a simplistic way of making a very important decision. Even though costs play a part in determining prices, they should not be allowed to be the cornerstone of your pricing policy. 

The significance of costs can be summarized in the following statements:

The producer’s cost indicates a floor price.

Customer’s cost is a sign of price sensitivity.

Competitor’s cost specifies its strength.

Assess the Value

Assess what value customers place on the product. This can be done by a variety of market research techniques.

Classify customers

Look for variation in the way customers give importance to the product. Different classes of the customer will put different values on your product offering such as given below:

• Heavy use
• Criticality of use
• Different uses

Identify a pricing structure

A price is not just a simple price point. There can be a lot of deviation in pricing the base offering and the price of add-ons. Variations can be there for different geographies, time of purchase, etc.

Assess customer’s emotional response to prices

This has to do with customer’s perception of the “fairness” of the price of the product.

Analyze the worthiness of returns

Analyze if returns are worth it. If mistake has been made in pricing, it should be corrected before further damage is inflicted on the company. Periodical review of pricing is a healthy practice.

DISTRIBUTION

Distribution refers to all the activities undertaken to transfer the product from the manufacturer to the consumer. The distribution channel is made up of various kinds of intermediaries such as retailers, distributors, wholesalers, and agents. These intermediaries fulfill a variety of functions. The structure of the distribution channel has to be decided first and foremost.

Going Directly to the consumer

As it is, there is a huge tendency on the part of entrepreneurs to bypass all and reach the customer directly. With the advent of the net, this has become a very popular alternative.

Going Directly to the Retailer: Bypass Distributor

A traditional distribution system will have super-stockiest, distributors, and retailers. Many entrepreneurs find it profitable to bypass the distributors and go directly to the retailer. This is sustainable strategy, especially in the light of the current crop of retailers coming into the market.

Using Sales Agents

It is more appropriate to use agents when selling to businesses. Till volumes pick up, it will be costlier to rely on your own sales force. Even in the long term, many firms have found it profitable to have company sales forces that work in tandem with sales agents. Sales agents are valuable because of their specialized knowledge of certain sectors or certain regions.

PROMOTIONS

Promotion includes all activities involving communication with the customer. This includes all advertising, public relations, and promotional campaigns. In this section, we will restrict the subject to dealing with promotional campaigns. Many of these promotional campaigns have been scoffed at by traditional marketing strategies as short-term measures aimed at immediate sales. For an entrepreneur, immediate sales are extremely important. 

Short-term sales is not the only reason to start a promotional campaign, there are many other objectives too:

• Sales
• Increase in distribution outlets
• Increase in self space
• Increase in-store presence
• Expand the selling season
• Increase purchase frequency
• Increase usage occasions
• Increase average transaction size
• Induce trial