UNIT 3

Marketing Mix
Marketing mix is the term used to describe the combination of the four inputs which constitute the core of a company's marketing system: the product, the price structure, the promotional activities, and the distribution system Product: Product is the article which a manufacturer desires to sell in the open market. It is the first element in the marketing mix. The product mix includes the following variables. Product line and range, Style, shape, design, colour, quality and other physical features of a product, Packaging and labeling of a product, Branding and trade mark given to the product, Product innovation, and Product servicing. Place: Physical distribution is the delivery of goods at the right time and at the right place to consumers. Physical distribution of product is possible through channels of distribution which are many and varied in character. Physical distribution (place mix) includes the following variables: Types of intermediaries available for distribution, Distribution marketing channels available for distribution, and Transportation, warehousing and inventory control for making the product available to consumers easily and economically. Promotion: Promotion is the persuasive communication about the product offered by the manufacturer to the prospect. Promotion mix includes the following variables: Advertising and publicity of the product, Personal selling techniques used, Sales promotion measures introduced at different levels, Public relations techniques used for keeping cordial relations with dealers and

consumers, Display of goods for sales promotion. Price: Price is one more critical component of marketing mix. It is the valuation of the product mentioned by the seller on the product. Price mix includes the following variables: Pricing policies, Discounts and other concessions offered for capturing market, Terms of credit sale, Terms of delivery, and Pricing strategy selected and used product

Product: bunch of benefits anything that is offered to a market for attention, acquisition, use or consumption and satisfies a want or need. It includes physical objects, services, persons, places, organizations and ideas. Services: Activities, benefits or satisfactions that offered for sale and are essentially intangible (i.e., banking, haircuts, hotel etc.).

Basic 3 LEVELS OF A PRODUCT Core Product: The problem-solving services or core benefits that consumers are buying when they obtain the product. Actual Product: a products parts, quality, features, design, brand name, packaging, staling etc., that combine to deliver core product benefits. Augmented product: additional consumer services and benefits built around the core and actual products (installation, delivery etc. for example , the Sony Camcorder)

The three levels of a product

Installation

AUGMENTED RPODUCT
Packaging

Delivery and Credit

Brand name Core Benefit Or service

After Sales service Features

CORE PRODUCT

Quality Staling

ACTUAL PRODUCT

Warranty

Another two more level of products Expected level of product Potential level of product New-Product Development: the development of original products, product improvements, product modifications and new brands through the firms own R&D efforts. NEW PRODUCT STRATEGY o Giving direction to the new product team and focusing team effort o Helping to integrate functional or departmental efforts o Allowing tasks to be delegated to new product team members o Proactive management introduction

THE NEW PRODUCT DEVELOPMENT PROCESS

New Product Strategy

Idea generation

Idea screening

Concept Development And testing

Marketing strategy

Business analysis

Product development

Test marketing

commercialization

The Product Life Cycle

PRODUCT LIFE CYCLE: SALES AND PROFITS

SALES
Maturity Product development Introduction Growth Decline

PROFITS

The product life cycle is the course of a products sales and profits over its lifetime. It involves the 5 stages below: Product development: the company finds and develops a new product idea costs mount, Introduction: the product is being introduced in the market profits are absent Growth: a period of rapid market acceptance increased profits Maturity: the product has achieved acceptance profits start to decline Decline: the period when sales fall off and profits drop.

Branding

Brand: a name, term, sign, symbol or design or a combination of these, intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors.

Brand levels:

Attributes: (i.e. Mercedes suggests such things as well engineered, wellbuilt etc.) Benefits: attributes translated into functional and emotional benefits (i.e., the attribute well-built translates into the benefit, I am safe in the event of an accident) Values: a brand may say something about the buyers values (i.e., Mercedes means high performance, safety and prestige) Personality: a brand also projects personality.

 Brand Equity: The value of a brand based on the extent to which it has high brand loyalty, name awareness, perceived quality, strong brand associations and other assets such as patents, trademarks and channel relationships (i.e., Nestle and its Rowntree (UK), Carnation (US), Stouffer (US), Buitoni-Perugina (Italy) and Perrier (France)). Branding Decisions

BRANDING DECISIONS

To brand or not to brand

Brand Name Selection

Brand sponsor

Brand strategy

Brand positioning

Brand No brand

Selection Protection

Producers Brand Private brand Licensed Brand Co-branding

New brands Line Extensions Brand Extensions Multi-brands

Brand Positioning No-brand positioning

Brand Extension : it has three parts viz: 1. line extension (change in existing product, like shape, size, taste, flavours, colours etc.). 2. brand extension (giving the brand name to different product like LG has given the brand to tv, fridge, washing machine etc. 3. image transfer (required in case of strong brand image has to be changed, like if haldiram will introduce haldiram bikes(automobiles) then problem will come).

PACKAGING Packaging involves designing and producing the container or wrapper for a product

Types of packaging Primary (inner packing) Secondary (outer packing) Tertiary (shipper packing)

The parts of Packaging The products container (the tube holding Colgate toothpaste) Secondary package (the box containing the tube of Colgate toothpastes) Shipping package (a box carrying six dozen tubes of Colgates) Tube print (printed information) Unit pricing (stating the price per unit) Open dating: stating the expected shelf life of the product. Nutritional labeling (stating the nutritional values in the product low fat, light, high-fibre)