Marketing experts around the world have generally agreed that there are a number of clearly identifiable variables that comprise of building blocks of marketing. These variables have been labeled “Marketing Mix” elements.
Identify these elements and discuss the concept of product as it relates to each of them.
A vital element in every marketing strategy is the marketing mix. The mix may be defined as ‘the particular group of variables offered to the market at a particular point in time.’ These variables are principally:
4. Distribution (place)
These are called the 4 P’s of marketing and they enable marketers to speedily respond to changes in the marketing environment.
Any decision about the marketing mix must begin with the product. Product refers to any thing that is offered to the market for its consumption or use. It can be physical goods or services.
It is important that the range and quality of the product mix be frequently evaluated and amended because it is a source of most of the company’s revenue.
People buy products mostly for benefits e.g. a car for luxury, comfort and speed – but not so much because of features. Organizations must strive to sell the benefits of their products, which must be designed into the product itself.
One important method used to sell benefits is branding products i.e. applying the organization’s signature to its products the use of special names, signs or symbols such as ‘Coca Cola’, Bic or even ‘Kimbo’.
Packaging is also another important factor in presenting a product to the market. It provides protection to a product and also reinforces the brand image. It also attracts customers at the point of sale.
Emphasis on the make up of the product is vital because of the need to sell the product and also because of another key factor i.e. ‘product life cycle’. Most products pass through a series of stages from the time they are introduced until the time they are withdrawn. These stages are:-
1. Introduction 2.Growth 3.Maturity 4.Saturation 5.Decline
The life cycle helps to plan the marketing mix, the development and introduction of new products, the withdrawal of the obsolete products and to set the revenue targets for each product. The life cycle concept makes an important contribution to the forecasting of sales and planning of products.
Price is important because it is the only element in the mix, which produces revenue: the others all represent costs. Price is the value placed on a good or service and may go many other names e.g. rent, fees, wages, interest, honorarium, etc.
Pricing of products determine the success of the firm, one may choose to introduce a product at a high price to recover costs or at a bargain to attract considerable sales.
The actions of competitors also have an important bearing on pricing decisions.
For a product to succeed, the marketing executive must have a thorough understanding of pricing decisions. Of all the 4 P’s only price can be changed quickly to respond to changes in the market.
Every product needs to be brought to the attention of the market through the identification of its benefits.
The principal methods of promotion are: advertising, personal selling, sales promotion and publicity. These are referred to as the promotion mix.
The aim of any promotional strategy is to bring existing or potential customers from a state of relative unawareness of products to a state of actively adopting them.
The following stages of customer behaviour have been identified: Stage 1 Unawareness of product
Stage 2 Awareness of product Stage 3 Interest in product Stage 4 Desire for product
Stage 5 Conviction about value of product Stage 6 Purchase of product
This is the process of communicating persuasive information about a product to target markets means of the spoken and written word and visual material.
The five principal media of advertising are:
• Print media – newspapers, magazines etc.
• Direct mail
• Outdoor – posters, billboards etc.
To effectively advertise a product, decisions must be made on issues such as:
• The amount to be spent,
• The message a firm wants to put across,
• The timing of adverts and the best media for that purpose.
b) Personal Selling
Here sales people communicate the product to the market in a face-to-face encounter.
Though quite expensive, personal selling can also be the most effective and most rewarding in clinching deals.
A company must decide how to structure its sales force depending on the product and the market being targeted.
c) Sales Promotion
This involves attempts to stimulate sales use of incentives e.g. special discounts, price reductions, bargain packs, gifts etc.
Sales promotion has proved very effective in the following areas:
• Drawing attention to new products
• Encouraging sales of slow moving products
• Stimulating off peak sales of products
• Increasing usage of products.
This is part of public relations. It doesn’t cost the organization money. Publicity is news about the product reported in the press or some other media without charge to the organization, however there are some costs involved in setting up a publicity programme.
Sponsorship of events and donations have become an increasingly popular form of publicity. These contribute significantly to an organization’s public image and thus helps in the sale of its products. For example the Dettol Heart Run.
PLACE (DISTRIBUTION DECISION)
This refers mainly to the movement of goods and services from producer to the consumer through a give channel of distribution. The product must be moved to the final consumer.
Below are the common channels of distribution:
The choice of channels utilized to distribute a product is determined the customer. In recent years there has been a trend towards shorter channels as customers realize the price advantages of bypassing the intermediaries.
Factors to consider when selecting channels
• Customer characteristics e.g. perishability
• Company characteristics e.g. financial status and product mix.
• Middlemen characteristics e.g. are they financially stable? What markets do they serve?
• Competitive characteristics – own channels be used or those already being used competitors?
• Environmental characteristics – Economic, political, legal, social and cultural factors also influence channel decisions.