Professional Documents
Culture Documents
A.PRODUCT MARKETING
Product marketing deals with the first of the "4P"'s of MARKETING , which are PRODUCT , PRICING , PLACE , and
PROMOTIONS.Product marketing, deals with more outbound MARKETING tasks. For example, product management deals
with the nuts and bolts of PRODUCT DEVELOPMENT within a firm, whereas product marketing deals with marketing the
PRODUCT to PROSPECTS CUSTOMERS , and others.
EXAMPLE : LUX TOILET SOAP.
-your product is one of the affordable in the market for its range.
etc etc.
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SERVICE MARKETING
SERVICE IS ANY ACT OR PERFORMANCE THAT ONE PARTY CAN OFFER TO ANOTHER THAT IS ESSENTIALLY
INTANGIBLE AND DOES NOT RESULT IN ANY OWNERSHIP
Services marketing is MARKETING based on relationship and value.
Marketing a service-base business is different from marketing a goods-base business.
There are several major differences, including:
The buyer purchases are intangible
The service may be based on the reputation of a single person
It's more difficult to compare the quality of similar services
The buyer cannot return the service
The major difference in the services marketing versus regular marketing is that instead of the traditional "4 P's," Product, Price,
Place, Promotion, there are three additional "P's" consisting of People, Physical evidence, and Process. Service marketing also
includes the servicescape referring to but not limited to the aesthetic appearance of the business from the outside, the inside,
and the general appearance of the employees themselves.
EXAMPLE: EDUCATION
Service quality is not one-dimensional; it encompasses numerous factors that are important to customer satisfaction.
Satisfaction basically is related to expectations and perceived delivery on these dimensions and as shown by the equation
given below.
The quality of service delivery results in customer satisfaction & their retention as it reinforces the perception that the value of
the service received is grater than the price paid for it.
Quality is defined as the ability of the service provider to satisfy customer needs. Customer perception , service quality &
profitability are interdependent variable.
Even in the case of products, quality is difficult to define because it is highly dependent upon customer perception. The task is
made more complicated in the case of service because of the intengible nature of service & the variation in services offered to
different customers.
There are several reasons why customers must be given quality service. Most important of them are
1. Industry has become so competitive that customers now have variety of alternatives. If the customers are lost, it can be
extremely difficult to win back the individual.
2. Most customers do not complain when they experience problems, these customers simply opt out & take their business
elsewhere.
1. Reliability: This refers to the ability of the company to perform the promised service dependably and accurately. Reliability is
probably the single most important dimension of quality. Customers expect that companies will do what they say and they will
do when they say they will do it.
2. Tangibles: This refers to the appearance of the physical facilities, equipment, personnel, and communication materials. As
services are intangible, the tangibles give an impression to the customers about the quality of service they can expect from a
firm. A bank in a shabby building will make the customer wonder whether their money will be safe in such a bank.
3. Responsiveness: This refers to the willingness of the employees to help customers and provide prompt service. When you
go to a bank the minimum that you expect is that the employees would attend to you rather than chit-chat amongst themselves.
4. Assurance: This factor is linked to several minor factors such as competence, courtesy, credibility and security. Competence
depends on the service provider's possession of the required skills and knowledge to perform the service. The politeness,
respect, consideration, and friendliness of the service providers can be bundled into the term courtesy. Credibility refers to the
perceived trustworthiness, believability, and honesty of the service provider. Security refers to the fact that the service should
be free from danger, risk, and doubt. In sum, the assurance factor refers to the knowledge and courtesy of employees and their
ability to inspire trust and confidence.
5. Empathy: Empathy refers to the caring, individualized attention the firm provides to its customers. It includes access,
communication and understanding. Access refers to the approachability and ease with which the customer can contact the firm.
Communication refers to keeping the customer informed in the language they can understand and listening to them.
Understanding has to do with the efforts made by the service provider to know customers and their needs.
The Service Quality Gaps:
Gaps between perceived & expected levels of service quality delivery result in the failure of the service provider.
These are the 5 gaps.
-The First gap does not know what customers expect. rea
-The second gap is between what the customer expects and what the management understands as the customers' expectation
from the company.
-The third gap is with reference to the management's understanding of the customer expectations and the service quality
standards set by the management.
-The fourth gap is between the quality specifications and actual service delivery.
-The fifth gap is between what is communicated to customers and what is actually delivered.
It is possible to measure the gaps and take corrective actions to fill them to the extent possible. The most difficult gap to fill is
the one between customer expectations and the perceived service delivery. The expectation of the customers keeps rising with
every good experience. When a customer visits the service organization, he/she expects a better service than what was
experienced in the last encounter.
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The service marketing challenges are
-to generate re-sales
-to create a waiting list
-to create a positive word of mouth advertising
as a lot of new business is generated from satisfied customers.
WHICH MEANS THAT THERE IS NO/LITTLE GAP BETWEEN
SERVICE EXPECTATIONS AND SERVICE DELIVERY.
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HOW DO YOU MATCH SERVICE EXPECTATION WITH DELIVERIES
IN PRODUCT MARKETING , WE RELY ON 4 P's
-product attributes/benefits
-pricing strategy
-place [ right / easy place to buy]
-promotions [ selected weighted mix]
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IN CASE OF THE SERVICE, THE PRODUCT IS
-intangible, the greater the intangibility the more complex
the promise.
-perishable /heterogeneous, the production and consumption are often simulaneous.
IN SERVICE MARKETING, WE RELY ON 7 P's
-product service [ features/benefits]
-place [ flexibility]
-price [ flexi]
-promotions [ selected weighted mix]
-people [ ability,competent, right attitude ]
-physical evidence
-process
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IN SERVICE BUSINESS,
-SERVICE MARKETING PROMOTES AND
SERVICE MANAGEMENT GENERATES RESULTS, through
*service delivery
*service quality
*customer satisfaction/ relation management
-service recovery
-service management audit.
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SERVICE MANAGEMENT PROVIDES SATISFACTORY SERVICE
-by designing the customer oriented business process
-cost effective service
-continuous improvements through research/development
-improving people's abilities/competences.
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SERVICE MARKETING MEETS SERVICE MANAGEMENT
-by managing customer behavior
-by conducting customer research
-by managing customer expectations
-by reverse-engineering the product/service portfolio.
-by determining what service the market needs/ we can offer.
-what do we need to do to fill the gap.
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THE INTEGRITY OF PRODUCT-SERVICE DELIVERY
when the service marketing is intergrated with service management
that is ,what you promise [either explicitly or implicitily] and
what you deliver
IN THIS CASE , ''INTEGRATED'' = ''INTEGRITY''
There is no gap
WHICH MEANS CUSTOMER SATISFACTION,
WHICH IT TURN MEANS = SUCCESSFUL SERVICE MARKETING.
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1.b) How would you reply to the small business person who says, “Marketing Research is too expensive, so the firm will just
have to get by without it’?
Business Intelligence
Business Performance Management
Business rules
Data Mining
Predictive analytics
Purchase order request
Enterprise Architecture
Information technology management
Knowledge Base
Online analytical processing
ETC ETC
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The major EXPECTATIONS of MARKETING RESEARCH are to:
reach an understanding of the relevant processes on the basis of the available historic information. This element forms the
basis for the development of models, required for forecasting and simulation.
provide information on the current situation, especially for early warning purposes, for instance related to issues impacting on
business, resources or business status.
forecast changes and impacts, either natural or man-made, as an element in vulnerability assessments.
forecast the consequences of policy decisions and measures before they are implemented in reality. This implies evaluating
options for several given scenarios based on the possible results and predicted consequences, and selecting the most
acceptable alternative.
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FOR THE MARKETING MANAGEMENT,
THE MARKETING RESEARCH IS THE MAIN/MAJOR TOOL
-to feel the market sensitivity/ market reactions to the product/ price etc
which helps in the decision to provide the market the right product/ right price/right promotion/
and at the right place.
CONSUMER Buying Behavior is the decision processes and acts of people involved in buying and using products.
Need to understand:
why consumers make the purchases that they make?
what factors influence consumer purchases?
the changing factors in our society.
Consumer Buying Behavior refers to the buying behavior of the ultimate consumer. A firm needs to analyze buying behavior
for:
Buyers reactions to a firms marketing strategy has a great impact on the firms success.
The marketing concept stresses that a firm should create a MARKETING MIX that satisfies (gives utility to) customers,
therefore need to analyze the what, where, when and how consumers buy.
Marketers can better predict how consumers will respond to marketing strategies.
Personal
Unique to a particular person. Demographic Factors. Sex, Race, Age etc.
Who in the family is responsible for the decision making.
Young people purchase things for different reasons than older people.
Psychological factors
Psychological factors include:
Motives--
A motive is an internal energizing force that orients a person's activities toward satisfying a need or achieving a goal.
Actions are effected by a set of motives, not just one. If marketers can identify motives then they can better develop a
marketing mix.
MASLOW hierarchy of needs!!
Physiological
Safety
Love and Belonging
Esteem
Self Actualization
Need to determine what level of the hierarchy the consumers are at to determine what motivates their purchases.
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Perception--
What do you see?? Perception is the process of selecting, organizing and interpreting information inputs to produce meaning.
IE we chose what info we pay attention to, organize it and interpret it.
Information inputs are the sensations received through sight, taste, hearing, smell and touch.
Selective Exposure-select inputs to be exposed to our awareness. More likely if it is linked to an event, satisfies current needs,
intensity of input changes (sharp price drop).
Selective Distortion-Changing/twisting current received information, inconsistent with beliefs.
Advertisers that use comparative advertisements (pitching one product against another), have to be very careful that
consumers do not distort the facts and perceive that the advertisement was for the competitor. A current example...MCI and
AT&T...do you ever get confused?
Selective Retention-Remember inputs that support beliefs, forgets those that don't.
Average supermarket shopper is exposed to 17,000 products in a shopping visit lasting 30 minutes-60% of purchases are
unplanned. Exposed to 1,500 advertisement per day. Can't be expected to be aware of all these inputs, and certainly will not
retain many.
Interpreting information is based on what is already familiar, on knowledge that is stored in the memory.
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Ability and Knowledge--
Need to understand individuals capacity to learn. Learning, changes in a person's behavior caused by information and
experience. Therefore to change consumers' behavior about your product, need to give them new information re: product...free
sample etc.
South Africa...open bottle of wine and pour it!! Also educate american consumers about changes in SA. Need to sell a whole
new country.
When making buying decisions, buyers must process information.
Knowledge is the familiarity with the product and expertise.
Inexperience buyers often use prices as an indicator of quality more than those who have knowledge of a product.
Non-alcoholic Beer example: consumers chose the most expensive six-pack, because they assume that the greater price
indicates greater quality.
Learning is the process through which a relatively permanent change in behavior results from the consequences of past
behavior.
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Attitudes--
Knowledge and positive and negative feelings about an object or activity-maybe tangible or intangible, living or non-
living.....Drive perceptions
Individual learns attitudes through experience and interaction with other people.
Consumer attitudes toward a firm and its products greatly influence the success or failure of the firm's marketing strategy.
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Personality--
all the internal traits and behaviors that make a person unique, uniqueness arrives from a person's heredity and personal
experience. Examples include:
Workaholism
Compulsiveness
Self confidence
Friendliness
Adaptability
Ambitiousness
Dogmatism
Authoritarianism
Introversion
Extroversion
Aggressiveness
Competitiveness.
Traits effect the way people behave. Marketers try to match the store image to the perceived image of their customers.
There is a weak association between personality and Buying Behavior, this may be due to unreliable measures. Nike ads.
Consumers buy products that are consistent with their self concept.
Lifestyles--
Recent US trends in lifestyles are a shift towards personal independence and individualism and a preference for a healthy,
natural lifestyle.
Lifestyles are the consistent patterns people follow in their lives.
EXAMPLE healthy foods for a healthy lifestyle. Sun tan not considered fashionable in US until 1920's. Now an assault by the
American Academy of Dermatology.
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Social Factors
Consumer wants, learning, motives etc. are influenced by opinion leaders, person's family, reference groups, social class and
culture.
Opinion leaders--
SPOKESPEOPLE etc. Marketers try to attract opinion leaders...they actually use (pay) spokespeople to market their products.
Michael Jordon (Nike, McDonalds, Gatorade etc.)
Can be risky...Michael Jackson...OJ Simpson...Chevy Chase
Roles and Family Influences--
Role...things you should do based on the expectations of you from your position within a group.
People have many roles.
Husband, father, employer/ee. Individuals role are continuing to change therefore marketers must continue to update
information.
Family is the most basic group a person belongs to. Marketers must understand:
that many family decisions are made by the family unit
consumer behavior starts in the family unit
family roles and preferences are the model for children's future family (can reject/alter/etc)
family buying decisions are a mixture of family interactions and individual decision making
family acts an interpreter of social and cultural values for the individual.
The Family life cycle: families go through stages, each stage creates different consumer demands:
bachelor stage...most of BUAD301
newly married, young, no children...me
full nest I, youngest child under 6
full nest II, youngest child 6 or over
full nest III, older married couples with dependant children
empty nest I, older married couples with no children living with them, head in labor force
empty nest II, older married couples, no children living at home, head retired
solitary survivor, in labor force
solitary survivor, retired
Modernized life cycle includes divorced and no children.
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Reference Groups--
Individual identifies with the group to the extent that he takes on many of the values, attitudes or behaviors of the group
members.
Families, friends, sororities, civic and professional organizations.
Any group that has a positive or negative influence on a persons attitude and behavior.
Membership groups (belong to)
Affinity marketing is focused on the desires of consumers that belong to reference groups. Marketers get the groups to approve
the product and communicate that approval to its members. Credit Cards etc.!!
Aspiration groups (want to belong to)
Disassociate groups (do not want to belong to)
Honda, tries to disassociate from the "biker" group.
The degree to which a reference group will affect a purchase decision depends on an individuals susceptibility to reference
group influence and the strength of his/her involvement with the group.
Social Class--
an open group of individuals who have similar social rank. US is not a classless society. US criteria; occupation, education,
income, wealth, race, ethnic groups and possessions.
Social class influences many aspects of our lives. IE upper middle class Americans prefer luxury cars Mercedes.
Upper Americans-upper-upper class, .3%, inherited wealth,
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2b) Discuss the role of personal selling and advertising in promoting industrial
products. How does it compare to consumer product promotion.
1.CONSUMER PRODUCTS
-appeals to the consumer emotions.
-appeals to the consumer desires.
-influences the buying decisions
with benefits feelings.
2.INDUSTRIAL PRODUCTS
-appeals to the consumer benefits.
-appeals to the consumer ownership.
-influences the buying decisions
with the usage values.
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3 a) Why do many firms use a family brand? What are the risks associated with this
strategy if a new product is sub-standard?
Family branding is a MARKETING strategy that involves selling several related PRODUCTS under one BRAND NAME. It is
contrasted with individual branding in which each product in a portfolio is given a unique identity and brand name.
There are often economies of scope associated with family branding since several products can efficiently be promoted with a
single advertisement or campaign. Family branding facilitates NEW PRODUCT INTRODUCTIONS by providing a 'foot-in-the-
door' in potential customers' evoked set. When considering purchasing a new type of product, potential customers will tend to
evoke in their minds a product with a familiar brand name. Being a part of this evoked set could lead to trial purchase, product
acceptance, or other advantages.
-1) Brand image of parent brand act as Differentiating factor for product in extremely competitive market.
-2) Extra cost of Brand creation is not required.
-3) Umbrella branding help to create dependent perception about product as parent Brand.
-4) Brands get abound in business.
-5) Umbrella branding helps to give positioning to product.
-6) Advertising and promotional efforts should be combined for all the products falling under family brand.
-7) New product launch become easier and cheaper.
- 8) New product find ready recognition and market set up.
3b) Consider the following statement and discuss: “The only thing that channel
intermediaries do is to increase price for the consumer.”
1.CHANNELS OFFER VARIOUS SUPPORT/ SERVICES
IN MARKETING OF YOUR PRODUCTS.
1.EXPLORATION STAGE.
*Statement of company objective.
*Statement of product idea.
*Judgment evaluation of merit.
*Profile of products known on the market.
[CEO / MARKETING DIRECTOR / MANUFACTURING [R&D] MAKE THE FINAL DECISION]
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*Survey of product ingredients, design standards,
general technology of the field.
*Analysis of competitive product claims.
[MARKETING / MANUFACTURING [R&D ]DECIDE THE FINAL DECISION]
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*Analysis of competitive advertising expenditures.
*Areas of brand share/volume history.
[MARKETING / PRODUCT MANAGERS DECIDE THE FINAL DECISION]
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*Survey of traditional channels of distribution and
other distribution opportunities.
*Survey of general selling practices, promotional
allowance buying standards.
*Survey of specific federal and state legal problems
in reference to ingredients, sales practices, controls.
[MARKETING / SALES / DISTRIBUTION DECIDE THE FINAL DECISION]
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*Survey to determine marketing opportunity area.
*Cyclical, seasonal, and long term marketing considerations.
*Product class profile study.
*Survey of potential customer interest in new product.
[MARKETING / PRODUCT MANAGEMENT DECIDE THE FINAL DECISION ]
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*Definition of the selected market.
*Preliminary opportunity estimate.
[MARKETING / SALES DECIDE THE FINAL DECISION.
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2. SCREENING STAGE
*Request for Planned Development Programme, with estimated investment and timetable.
*Approval of research and development budget.
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*Initial design/formulation of product.
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*Initial costing based on optimum manufacturing levels. *Determination of local tax, licensing, and other financial
considerations.
*Performance and efficiency tests.
*Independent laboratory/engineering analysis of prototypes.
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*Preparation of copy platform.
*Panel evaluation of prototype product.
*Forecast of volume potential.
*Customer testing/opinion
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*Determination of plant capacity and facilities availability.
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4. DEVELOPMENT STAGE
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*Plant location and transportation considerations.
*Basis of appropriation.
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*Development of media plan.
*Decision on manufacturer association-identification on/with product.
*Creation of brand name possibilities.
*Legal search of brand name possibilities.
*Registration of trademark, copyright brand name.
*Development of basic customer selling theme.
*Approval of package design (and inserts).
*Preparation of instructions/directions to conform.
*Adoption of media philosophy, based on selling theme, budgetary consideration, coverage of prospects, and availability.
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*Determination of labour availability.
*Study of labour or union regulations.
*Determination of raw material commitments and availability.
*Determination of special tooling and equipment.
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5. SALES TESTING STAGE
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*Manufacturing pilot run. Approval of test area production.
*Shipping, storage, and packing tests.
*Plan to meet competitive reaction.
*Finalisation of test areas.
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*Forecast of P/L limits of successful venture and of unsuccessful write-off.
*Test area simulation of national campaign concept.
*Determination of test area total appropriation.
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*Preparation of media merchandising. Preparation of trade selling sheets.
*Determination of educational plan and appropriation. *Preparation of customer educational materials.
*Determination of publicity plan and appropriation.
*Preparation of introductory publicity materials.
*Determination of sales promotion plan and appropriation. *Approval of test area commercial plan and insertion schedule.
*Setting of sales quotas.
*Establishment of sales force incentives, bonuses, premiums. *Establishment of trade incentives - buying allowances, contests.
Cyber marketing
In other words, cyber marketing is a blend of internet technology and direct marketing principles that is adopted by business
owners to find profitable customers and to interact with them in order to enhance their business activities, thereby ensuring
improved ROI (Return on Investment.) A number of activities are involved in cyber marketing such as online marketing, fax
direct marketing, canvassing, call center direct marketing, and mobile phone marketing via SMS (Short Message Service.)
Benefits derived from the adoption of cyber marketing techniques are immense. First of all, it enables to minimize business
costs and helps you to reach a substantial number of customers and that too within minimal time frame. Another great benefit
of cyber marketing is that it allows you to cost-effectively reach in any type market, let it be regional, national, and international.
Also, a significant benefit of cyber marketing is that it enables you to win profitable customers. Exceptionally low marketing
costs, high profit margin, increased customer loyalty, round the clock services, and expansion in customer base are the other
obvious benefits of cyber marketing.
However, it is not as easy you think to enhance your business profitability via cyber marketing techniques. In other words, in
order to employ this marketing technique, it is important that business owners and other people engaged in the internet field
such as ecommerce and marketing professionals must possess adequate skills.
Cyber marketing includes
- E-Business technology
- E-Business Communication
- E-Business Distribution Systems
- E-Business Value Strategies
- E-Business Strategy
- E-Business Management
- Individual as well as the diffusion of innovations
- How to gather and use information
- The Political, Legal, and Ethical Environment
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