Marketing

1. Definition of marketing

Marketing is the management process responsible for identifying, anticipating and satisfying customers’ requirements profitably. Marketers have to identify or anticipate consumer needs, develop products or services that meet the needs better than any competing products or services. They also need to persuade target customers to try the product or service. In the long term they may need to modify their products or services to satisfy changes in consumer needs and market conditions. Marketers can design particular features, attractive packaging, and effective advertising, that will influence consumers’ wants. Marketing thus combines market research, new product development, distribution, advertising, promotion, product improvement and so on.

2. The selling concept versus the marketing concept

Most management and marketing writers now distinguish between selling and marketing . The selling concept assumes that resisting consumers have to be persuaded by vigorous hard-selling techniques to buy non-essential goods and services. Products are sold rather than bought. The marketing concept, on the contrary, assumes that a company’s choice of what goods and services to offer should be based an the goal of satisfying consumers’ needs.

3. Identifying market opportunities – market research

Marketers are always looking for market opportunities – profitable possibilities of filling unsatisfied needs or creating new ones in areas in which the company is likely to enjoy a competitive or differential advantage (an advantage over competitors in terms of quality, price distribution etc.)

Rather than risk launching a product or service only on the basis of intuition, most companies undertake market research. They collect and analyse information about the size of the potential market, about consumers’ reactions to particular product and service features, and so on

There are four basic research methods used by marketers:

• Observation: Researchers monitor particular situations or actions of consumers. Today computerised systems allow marketers to observe consumers’ preferences.
• Survey: When conducting a survey marketers need to ask questions about new marketing ideas, product or service preferences. The heart of any survey is a questionnaire that is mailed to the consumers or is used as the basis of a telephone or personal interview.
• Focus groups: Members of the target market  (6 to 15 individuals) are invited to discuss a product concept.
• Experimental research: This can be used to compare responses to the products and services under different circumstances.

Market segmentation is used to divide the market into distinct groups of buyers who have different requirements or buying habits. Once a target market has been identified and market research has been conducted, the company has to decide what products or services offer.

4. The marketing mix

Once the basic offer, e.g. a product concept has been established, the company has to think about the marketing mix, i.e., all the various elements of a marketing programme. The best known classification of these elements is the `4 Ps’ : product, (quality, features, style, brand name, size, packaging, services and guarantee), place, (distribution channels, locations of points of sale, transport, inventory size, etc.) promotion (advertising; publicity, sales promotion, and personal selling, ) and price (basic list price, discounts, the length of payment period, possible credit terms and so on). The marketing mix can. be changed during the life of the product if necessary.

5. Market structure and competition

When developing and marketing products, companies need to consider competition in the given target market.

Market leader: This is the highest market share company which retains its position by trying to expand the total market or its market penetration, for example through an aggressive advertising campaign.

Market challenger: One or more non-market leaders which aggressively attack for additional market share.

Market follower: These are low share competitors without the resources to challenge or seriously contend for  market leadership.

6. The promotion mix

Even a good, attractively priced product has to be made known to its target customers. During the introduction and growth stages of the standard product life cycle, the producer or the company has to develop product or brand awareness, inform potential customers or the other members of the distribution channel.

• Advertising informs consumers about the existence and benefits of products and services, and attempts to persuade them to buy them. Informative advertising tells us what goods are available and gives the facts about them so that a consumer can choose the article that suits him best. Competitive or persuasive advertising tries to persuade people to buy the goods whether or not they want them.

• Sales promotion such as free samples, coupons, price reductions, competitions, and so on are temporary tactics designed to stimulate the sales of the product. Free samples combined with advertising may generate the initial trial of a new product in the introductory stage of the product life-cycle. During the maturity and the decline stages marketers can try out promotional tactics such as reduced price packs, discounts, competitions, free gifts, premiums, coupons, special offers, games, and so on.

• Public Relations (PR) is concerned with maintaining, improving or protecting the image of a company or product. One of the most important elements of PR is publicity which is any mention of the company’s or product’s name that is not  paid for. Many companies attempt to place stories (e.g. news releases) or information in news media  to attract attention to a product or service. Publicity can have a huge impact on public awareness that could not be achieved by advertising, or at least not without an enormous cost. A lot of research shows that people are more likely to read and believe publicity than advertising.

• Personal selling is said to be quite expensive. Sales people spread information about the company’s products and services and assist customers with possible technical problems.

7. Advertising media

Advertising media can be divided into the following categories:

• The print media (newspapers, magazines, direct mail)
• The broadcast media ( radio and television)
• Other advertising media: outdoor advertising ( posters, illuminated signs) transit advertising,
• ·point of purchase displays in shops, and so on.

8. Branding

Branded goods are marked with a distinctive name and/or design. A brand is a name, term, sign, symbol, or design, or a combination of these to identify the goods or services of one seller, or a group of sellers. Accordingly, there are product brands and service brands. One of the most important functions of branding is to differentiate the given products or services from those of competitors’. This is referred to as brand differentiation.

A brand name is that part of a brand which can be vocalized – the utterable. Examples are Avon, Chevrolet, Disneyland, American Express etc. A brand mark is that part of a brand which can be recognized but is not utterable, such as a symbol, design, or distinctive coloring or lettering. Examples are the Metro-Goldwyn-Mayer lion, and the red K on a Kodak film box. A brand label is a simple tag or complex design (graphics) attached to the product. The label might carry only the brand name, and also a great deal of information.

Brand loyalty refers to the degree to which a consumer purchases a certain brand without considering alternatives. On the other hand, the term brand switching is used to describe consumer behaviour when consumers are not loyal to a specific brand in a given product category. They are ready to purchase alternative brands as well.

Brand image is the set of beliefs consumers hold about a particular brand. Brand equity refers to the value of how such people as consumers, distributors, and sales people think and feel about the brand relative to its competitors over a period of time.