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Chapter 8: Marketing
Products and Services
The development of good products and services considers: - quality - design features - benefits
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Chapter 8: Marketing
Convenience Products
Products that make life easier.
Consumers buy often, don’t shop around and don’t delay purchase.
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Chapter 8: Marketing
Shopping Products
Expensive or high quality products.
Consumers will shop around for best deal.
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Chapter 8: Marketing
Specialty Products
Unique, rare, hard to find products.
Consumers won’t shop around and may go far to purchase specialty products.
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Chapter 8: Marketing
PriceBusinesses need to be price sensitive and look at their competitors’ prices for the same products.
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Chapter 8: Marketing
Types of Pricing Strategies
1.Skim Pricing2.Penetration Pricing3.Competitive Pricing
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Chapter 8: Marketing
Skim Pricing
Initial price is set high because demand is high. As demand reduces so to will the price in order to increase demand.
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Chapter 8: Marketing
Penetration Pricing
Initial price is set very low to attract customers in the hopes of establishing customer loyalty.
As customer loyalty increases (demand) the price will be raised.
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Chapter 8: Marketing
Competitive Pricing
Adjusting prices to match that of competitors’.
This may lead to PRICE WARS!
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Chapter 8: Marketing
Place (Channels of Distribution)
Channels of distribution are the paths of ownership that goods follow as they pass from the producer to the consumer.
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Chapter 8: Marketing
Direct ChannelProducts are sold directly to the consumer.
Examples:•Farmer’s market•Bakery•Factory Outlet
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Chapter 8: Marketing
Indirect ChannelProducer sells their product to an intermediary who then sells it to the consumer. This adds to the price.
Producer Intermediary Consumer
Example:
Retailer
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Chapter 8: Marketing
Specialty ChannelConsumer buys from a place other than a retail store.
Example:•Online (e-commerce)•Vending machine•Catalogue •Telemarketing
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