MARKETING

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THE MARKETING PLAN- CHAPTER 10

IDENTIFY the purpose of the marketing plan

DESCRIBE the part marketing tactics play in the marketing plan

NAME the five marketing strategies that make up the marketing mix

Marketing the iPad and iPad Apps

WHAT DO YOU NEED BEFORE YOU START MARKETING?

Marketing PlanBlueprint used by a business to guide its

marketing

activities to a desired conclusion.

It should include:

Marketing TacticsActivities that need to be taken to carry out

the marketing plan

Target Market Objectives

Mix of Marketing Strategies

Marketing Budget

Marketing Tactics

MARKETING DEFINITIONS

Target MarketThe group of people you plan to market

your product to.

(Demographics)

Marketing ObjectivesGoals a business wants to accomplish

through its

marketing efforts.

Who is your target market? What are your marketing goals?

MARKETING MIX

FIVE “P”s of MarketingProduct

Price

Place

Promotion

PEOPLE!

PRODUCT

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PRODUCT STRATEGY

What goods and services is your business going

to provide consumers?

Your product will be identified by…

1. Brand: Name, symbol, or design used to identify a product

2. Package: Physical container or wrapper that holds the product

3. Label: Part of package used to present information

PRODUCT STRATEGY

Product PositioningHow consumers view your product

compared to the

competitions product. Prestigious? Good Bargain? Equal in Quality?

Product MixAll of the products a company makes and

sells.EX: Kim Kardashian

PLACE

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PLACE STRATEGY

How are you going to deliver your goods and

services to customers? Will your product be for

sale where and when your customers what it?

Channel of DistributionPath your product takes from producer

(manufacturer)

to consumerDirect Distribution: Move from producer to consumer with NO ONE in between

Indirect Distribution: Intermediaries move products between producer to consumer.

1) PRODUCER

Business that gathers raw goods.Materials gathered in their original state from natural resources.

T-SHIRTCotton & Polyester

2) PROCESSOR

Changes raw materials into a more finished

product.

T-SHIRTTurn cotton and polyester into thread

Create Twill for seam binding

3) MANUFACTURER

Business that makes finished products out of

processed products.

T-SHIRTCreates the t-shirt of out the thread and

seam

binding

4) INTERMEDIARY

Business that moves goods from one business

to another. It buys goods, stores them, and then resells them.

T-SHIRTBuys the ready-made t-shirts in very large quantities and

stores them. They sell these shirts to wholesalers

5) WHOLESALER (DISTRIBUTOR)

Distributes goods by dividing large quantities

into smaller ones and sells them to retailers.

T-SHIRTDivide and distribute the t-shirts in smaller quantities

to stores

6) RETAILER

Purchases goods from a wholesaler and sells them to

consumers, the final buyers of the goods.

Consumers buy the t-shirt from a retailer. Kohl'sAmerican Eagle

T-SHIRT

GRAPHIC ORGANIZER

1.

2.

3.

4.

5.

6.

Wholesaler

Processor

Manufacturer

Retailer

Producer

Intermediary

TEAM TEACHING

Group 1: Selecting a Channel of Distribution (229)

Group 2: Intensity of Distribution (230)

Group 3:Transportation (230-231)

Group 4:Location, Layout, Availability (231)

Group 5: Questions to Ask About Place Decisions (232)

Group 6: Impact of Technology on Place Strategy (232 & Figure 10.3)

THE PRICE STRATEGY- CHAPTER 11

• IDENTIFY factors that affect pricing strategy

• SUMMARIZE the marketing objectives related to pricing

• DESCRIBE the components that go into making price strategy decisions

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PRICE STRATEGY

Setting a price for a good or service is not easy.

Things to take into consideration:

Fixed Expenses: Costs that DO NOT vary with the

number of units sold

Variable Expenses: Costs that DO vary with the

number of units sold

THINK/PAIR/SHARE--- 3 examples of each!

COSTS SUPPLY AND DEMAND

CONSUMER PERCEPTIONS

COMPETITION

GOVERNMENT REGULATIONS

TECHNOLOGICAL TRENDS

Inelastic Demand:Customers will buy a product regardless of price

Elastic Demand:Prices are sensitive to demand

Dominick's and Jewel Price Fixing

Article

SUPPLY AND DEMAND

CONSUMER PERCEPTIONS

Prices too ?Consumers may believe your product lacks quality

Prices too ? Consumers may believe your product is of higher quality and status

What should your prices be for your specific target market?

GOVERNMENT REGULATIONS

Price Gouging

Practice of pricing above the market with no

alternatives

Price Fixing

An illegal practice in which competing

companies agree on specific prices

Unit Pricing

Required pricing of goods on the basis of the

cost per unit of measure (pound, ounce)

SETTING A BASIC PRICE

Cost-Based PricingYou must consider your business costs and profit

ObjectivesMarkup: The amount added to your cost to cover expenses

Demand-Based PricingOnly used if your product is inelastic AND your

Product has a greater value than competitors

Competition-Based PricingFind out what your competition charges and

then

decide if your price should be lower, the same, or

higher

PRICING POLICIES

Flexible-Pricing PolicyAllows customers to bargain for a price Advantages and Disadvantages? Examples?

One-Price PolicyAll customers are charged the same price Advantages and Disadvantages? Examples?

PRICING TECHNIQUES

Discount Pricing Cash Discounts (2/15, n/30) Quantity Discounts Seasonal Discounts

Psychological Pricing The customers perception of the product are strongly

influenced by price

PRICING WORKSHEET!

CALCULATING PRICES

Break-Even Point– When the cost to make the item equals how much you made

(Fixed Cost/Unit Selling Price)-Variable Costs

Markup- Amount added to the cost of an item to cover expenses and ensure a profit $$

Price – Cost = PROFIT!

Markdown- The amount of money taken from the original price

Price X Markdown % = $ Markdown

THE PROMOTION STRATEGY- CHAPTER 12

EXPLAIN the role of the promotion strategy

EXPLAIN how to formulate promotional plans

IDENTIFY considerations for putting together a promotional mix

DESCRIBE the elements of a promotional mix

PROMOTI

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PROMOTIONAL STRATEGY

Communication intended to persuade, inform,

and remind a target market about a business

and its products

Promotional PlansPreopening Plan Establish a positive image Let customers know you are opening for business Bring in customers/have them contact you Make customers interested

Ongoing Plan

SELECTING A PROMOTIONAL MIX

Combination of different promotional elements that a company uses to reach and influence potential customers

Considerations that need to be made:Target MarketProduct ValuePromotional ChannelsTime FrameCost

ADVERTISING

Paid non personal presentation of ideas, goods, or services.

Advertising Campaign- Series of related promotional activities with a similar theme

Successful Advertising Campaigns

DIFFERENT TYPES OF ADVERTISING

Newspapers Magazines Direct Mail Outdoor Advertising Directories Transit Advertising Specialty Items Television Radio Internet

INTERNET ADVERTISING

** #1 Fastest growing medium for advertising **

Website Goals:

1. Attract Visitors

2. Convert Visitors

Advantages Disadvantages

Expanded Markets Buyers do not have an opportunity to physically see the product

No Geographic Location Security

Cost Savings

Quick Turn Around Time

SALES PROMOTION

The use of incentives or interest-building activities to stimulate traffic or sales.

Premiums- Anything of value that a customer

receives in addition to the product purchased

(ex.- coupons and gifts)

Rebates- a return of part of the purchase

price

Displays

Samples- Free trial size samples or in store samples (Costco!)

Sweepstakes and Contests

Sweepstakes: a simple game of chance

Contest: Customer has to do something to win

SALES PROMOTION CONT.

Rational Buying Motive

• A conscious, logical reason to make a purchase

• Product dependability• Time or money savings• Convenience• Comfort• Health or safety issues• Recreational value• Service• Quality

Emotional Buying Motive

• A feeling a buyer associates with a product

• Social approval• Recognition• Power• Affection• Prestige

CUSTOMER KNOWLEDGE

PUBLICITY

Placement in the media of newsworthy items about a company or product

Ways to draw attention to your business:

1. Write news releases- brief newsworthy story sent to the media

2. Write Feature Articles

3. Submit captioned photos

4. Call a press conference

5. Seek interviews

6. Public Relations- activities designed to create goodwill toward a business

BUDGETING FOR PROMOTION

Industry Average- Standard used to compare costs from promotional expenses

Not Creative? GET HELP!1. All major media advertising companies have

advertising departments

2. Cooperative Advertising- Advertising costs are divided between two + parties

3. Advertising Agency- Company that acts as an intermediary between the business and the media to communicate a message to the target market

4. Web Designers

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PEOPLE STRATEGY

How will your business assemble, prepare, and maintain

the people who will help you achieve success?

Basic Hiring CriteriaDeveloping EmployeesEstablishing a productive environmentRewarding Employees

COMMERCIALS

Add relevant commercials and discuss the 5 “P”s of marketing.