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INTRODUCTIONS

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INTRODUCTIONS
 Final Presentations and Report - Group
 Case studies to be presented in class -
Individual
 Article Presentations (At least two latest
articles on Marketing )
 All communication to be conducted through
IQUEST

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Definitions “Marketing is Managing profitable customer

relationships.”

The process by which companies

create value for customers and build
strong customer relationships in order
to capture value from customers in
return

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Definitions Fulfilling customers wants and desires in

order to make a profit

The process of planning and executing

the conception, pricing, promotion and
distribution of ideas, goods and
services to create exchanges that
satisfy individual and organizational
objectives
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Getting a product to the customer

Basic  Anticipating customer need

Idea of
 Developing and selling product
Marketin
concept
g
 Creating/anticipating
demand
 Fulfilling demand

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OPERATIONS

MARKETING Producer/Deliverer
4Ps & 5Cs
AS A FIELD
OF STUDY Information Distributor
Wholesaler Customer
Product/ Retailer Attitude Behavior
Service
Characteristics

Existing Concept Necessity

/Desire

RESEARCH

CONSUMER
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CUSTOMER IS THE

KING

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OPERATIONS

MARKETING Producer/Deliverer
4Ps & 5Cs
AS A FIELD
OF STUDY Information Distributor
Wholesaler Customer
Product/ Retailer Attitude Behavior
Service
Characteristics

Existing Concept Necessity

/Desire

RESEARCH

CONSUMER
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Understand the marketplace,

customer needs and wants

Design a Marketing Strategy

Construct a marketing
program

Build Profitable relationships

with Customers

Capture value from customers

in return

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NASCAR Case

Pg 3-4

Principles of Marketing 11th

Edition

Anyone can be called to

summarize the case

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Needs
Terms
States of felt deprivation
&
Concepts Wants

The form as human needs take as shaped by culture and

individual personality

Demands

Human wants that are backed by buying power

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What does marketing offer?

Terms
Products, Services, Experiences
&
Concepts Exchange

The act of obtaining a desired object from someone by

offering something in return

Marketing Management

The art and science of choosing target markets

and building profitable relationships with them

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Value Proposition
Terms
Set of benefits or values it promises to deliver
& to consumers to satisfy their needs
Concepts

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Production Concept
Marketing
The idea that consumers will favour products
Management that are available and highly affordable
Orientations

Product Concept
The idea that consumers will favour products
that offer the most in quality, performance and
features and that organizations should therefore
devote all its efforts to make continuous product
improvements

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Selling Concept
Marketing
Management The idea that consumers will not buy enough of
the firm’s products unless it undertakes a large
Orientations scale selling and promotion effort

Marketing Concept

The marketing management concept holds that

achei8ving organizational goals depends on
knowing the needs and wants of target markets
and delivering the desired satisfactions better
than competitors do

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Societal Marketing Concept

Marketing
Management A principle of enlightened marketing that holds
that a company should make good marketing
Orientations decisions by considering consumers wants, the
company’s requirements, consumer’s long term
interests and society’s long run interests

Terms Customer Relationship Management (CRM)

&
The overall process of building and maintaining
Concepts profitable customer relationship by delivering
superior customer value and satisfaction

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Customer Perceived Value

Terms
& The difference between total customer value and
total customer cost
Concepts

Customer Value: The customer’s perceived evaluation

of benefits and cost of a marketing offer to a
customer as compared to other competing offers

Customer Cost: The customer’s perceived expenses

that would be incurred in acquiring and using a product

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Terms
& WHY DO
Concepts
PEOPLE GO TO
SHOPPING
MALLS TO BUY
GROCERIES?

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Customer Lifetime Value

Terms
The value of the entire stream of purchases that
& the customer would make over a lifetime of
patronage
Concepts

Share of Customer

The portion of the customer’s purchasing that a

company gets in its product categories

Customer Equity

The total combined customer combined customer

lifetime values of all of the company’s customers

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Terms
High
&
Concepts Butterflies True Friends

Potential
Profitability

Strangers Barnacles
Low

Short-term Long-term
Customers Projected Customers
Loyalty

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Strangers Little fit b/w company’s

Terms
offerings and customer’s
& needs, lowest profit potential
Concepts
Barnacles Limited fit b/w company’s
offerings and customer’s
needs, low profit potential

Butterflies Good fit b/w company’s

offerings and customer’s
needs, high profit potential

True Friends Good fit b/w company’s

offerings and customer’s
needs, highest profit potential

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McDonald’s Case

Pg 63-64

Principles of Marketing 11th

Edition

Anyone can be called to

summarize the case

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The actors and forces outside marketing

that affect marketing management’s
ability to build and maintain successful
relationships with target customers

 Immediate Environment
Customers, Suppliers, Distribution
Channels, Competitors

 General Environment
Locality, City, Country, Society, The
World

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MICROEVNIRONMENT MACROEVNIRONMENT

The actors close to the company

that affect its ability to serve
its customers – the company,
suppliers, marketing
intermediaries, customer
markets, competitors and publics

The larger societal forces that

affect the microenvironment –
demographic, economic, natural,
technological, political and
cultural forces

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THE COMPANY

Microenvironment
 Internal Environment – Infrastructure,
Departments, Management, Employees,
Share Holders

 Marketing vs. Production

 R&D vs. Finance

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SUPPLIERS

Microenvironment
 Part of the supply chain

 Interaction with suppliers has a direct

impact on company’s profitability,

 Schedules, Quality, Cost, Service

 Supplier Qualification & Development –

e.g. Walmart, Target, GE

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MARKETING INTERMEDIARIES
“ Firms that help the company to promote,
Microenvironment sell, and distribute its foods to final
buyers, they include resellers, physical
distribution firms, marketing service
agencies and financial intermediaries.”

 Resellers: Wholesalers, Retailers

 Physical Distribution: Logistics,
Transportation
 Marketing Services: Marketing Research,
Advertising, Media firms, Marketing Consultants

 Financial Intermediaries: Banks, Insurance

companies, Credit Companies

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CUSTOMERS

Microenvironment
 Customer vs. Consumer

COMPETITORS

 Direct and Indirect

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PUBLICS

Microenvironment
 Financial
 Media
 Government
 Citizen Action
 Internal Publics
 General Publics?

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 DEMOGRAPHIC ENVIRONMENT

Macroenvironment
ECONOMIC ENVIRONMENT

 NATURAL ENVIRONMENT

 TECHNOLOGICAL ENVIRONMENT

 POLITICAL ENVIRONMENT

 CULTURAL ENVIRONMENT

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PEST FACTORS

Macroenvironment
POLITICAL
ECONOMIC
SOCIAL
TECHNOLOGICAL

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DEMOGRAPHIC ENVIRONMENT

Macroenvironment
 Demography: Study of human populations
in terms of size, density, location, age,
gender, race, occupation and other
statistics
 Attempts to change demography
 Classification of Population
 Baby Boomers – 1946 - 1964
 Generation X - 1965 - 1976
 Generation Y - 1977 - 1994
 Generation Z – 1995 - 2001
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DEMOGRAPHIC ENVIRONMENT

Macroenvironment
 Geographic shifts in population

 Changing family patterns

 Generational Marketing

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 ECONOMIC ENVIRONMENT

Macroenvironment
Factors that affect consumer buying
power and spending patterns

 Changes in Income
 Changes in Consumer Spending Patterns

“Differences noted a century ago by Ernst

Engel of how people shift their spending
across food, housing, transportation, health
care and other goods and services
categories as family income rises”

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 NATURAL ENVIRONMENT

Macroenvironment
Natural Resources that are needed as
inputs by marketers of that are affected
by marketing activities

 Shortage and over consumption e.g Oil

 Increased Population
 Government intervention in natural resource
management
 Carbon Credits Trading

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 POLITICAL ENVIRONMENT

Macroenvironment
Laws, government agencies and pressure
groups that influence and limit various
organizations and individuals in a given
society
 War On Terror
 Travel, Trade, Financial Transactions,
Shipping (Regulations)
 Cold War for Resource Control
 Global Warming
 WTO

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 CULTURAL ENVIRONMENT
Institutions and other forces that effect
Macroenvironment society’s basic values, perceptions,
preferences and behaviors

 Persistent Cultural Values

 Shifting Secondary Cultural Values
e.g. Music
 People’s Views
 Themselves  Society
 Others  Nature
 Organizations  Universe
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MODEL OF BUYER BEHAVIOR

STIMULI
Buyer Marketing Other
Behavior Product Economic
BUYER RESPONSES
Price Technological
 Product Choice
Place Political
 Brand Choice
Promotion Cultural
 Dealer Choice
 Purchase Timing
BUYER’S BLACK BOX  Purchase Amount
 Buyer Characteristics
 Buyer Decision Process

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FACTORS INFLUENCING CONSUMER BEHAVIOR

 CULTURAL

 SOCIAL

 PERSONAL

 PSYCHOLOGICAL

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FACTORS INFLUENCING CONSUMER BEHAVIOR

CULTURAL CULTURE: The set of basic values, perceptions, wants

and behaviors learned by a member of society from
family and other important institutions

 US values – achievement and success, activity and

involvement, efficiency and practicality, material
comfort, individualism, freedom, humanitarianism,
youthfulness, fitness and health
 Values change from country to country
 Cultural shifts convert into new product
opportunities e.g health and fitness

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FACTORS INFLUENCING CONSUMER BEHAVIOR

CULTURAL
SUBCULTURE: A group of people with shared value
systems based on common life experiences and
situations

 Area, Ethnicity, Language

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FACTORS INFLUENCING CONSUMER BEHAVIOR

SOCIAL CLASS: Relatively permanent and ordered

CULTURAL divisions in a society whose members share similar
values, interests and behaviors

Upper Uppers
Upper Class
Lower Uppers

Middle Class Upper Middles

Middle Class

Working Class

Upper Lowers
Lower Class
Lower Lowers

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FACTORS INFLUENCING CONSUMER BEHAVIOR

SOCIAL GROUP

GROUP: Two or more people who interact to accomplish

individual or mutual goals

OPINION LEADER: Person within a reference group

who, because of special skills, knowledge, personality or
other characteristics, exerts influence on others

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FACTORS INFLUENCING CONSUMER BEHAVIOR

SOCIAL FAMILY

 Roles and influences of family members on

purchasing

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FACTORS INFLUENCING CONSUMER BEHAVIOR

SOCIAL ROLES AND STATUS

 Roles and influences of family members on

purchasing

 Value, Usability, Size

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FACTORS INFLUENCING CONSUMER BEHAVIOR

PERSONAL AGE & LIFECYCLE STAGE

 Food, Clothes, Furniture, Recreation

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FACTORS INFLUENCING CONSUMER BEHAVIOR

PERSONAL OCCUPATION

 Nature, type of work

 Job location, travel route

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FACTORS INFLUENCING CONSUMER BEHAVIOR

PERSONAL ECONOMIC SITUATION

 Spending power, Loans, debts

 Credit Rating, Income levels

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FACTORS INFLUENCING CONSUMER BEHAVIOR

PERSONAL LIFE STYLE

Life Style: A person’s pattern of living as experienced

in his or her activities, interests and opinions
AIO Dimensions

Activities – Work, Hobbies, Shopping, Sports, Social

Events

Interests – Food, Fashion, Family , Recreation

Opinions – About themselves, Social Issues, Business,

Products

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FACTORS INFLUENCING CONSUMER BEHAVIOR

PERSONAL PERSONALITY AND SELF-CONCEPT

Personality: The unique psychological characteristics

that lead to relatively consistent and lasting responses
to one’s own environment
• Brands also have personalities
• 5 brand personality traits
• Sincerity – Peace TV
• Excitement - MTV
• Competence - Toyota
• Sophistication - Mercedes
• Ruggedness – Levi’s
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FACTORS INFLUENCING CONSUMER BEHAVIOR

PSYCHOLOGICAL

MOTIVATION

Motivation: A need that is sufficiently pressing to

direct the person to seek satisfaction of the need

• “Person’s buying decisions are affected by

subconscious motives that even the buyer may not
fully understand”. Sigmund Freud’s Theory
• “ A person tries to satisfy the most important need
first.” Maslow’s Hierarchy of Needs

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FACTORS INFLUENCING CONSUMER BEHAVIOR

PSYCHOLOGICAL

PERCEPTION

Perception: The process by which people select,

organize and interpret information to form a
meaningful picture of the world

LEARNING

Learning: Changes in an individual’s behavior arising

from experience

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FACTORS INFLUENCING CONSUMER BEHAVIOR

PSYCHOLOGICAL

BELIEF

Belief: A descriptive thought that a person holds about

something

ATTITUDE

Attitude: A person’s consistently favorable or

unfavorable evaluations, feelings and tendencies
toward an object or idea

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BUYING DECISION BEHAVIOR

 Complex Buying Behavior

 Dissonance Reducing Buying Behavior

 Habitual Buying Behavior

 Variety Seeking Buying Behavior

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BUYING DECISION BEHAVIOR

 Complex Buying Behavior

Consumer buying behavior in situations

characterized by high consumer involvement in a
purchase and significant perceived differences
among brands

E.g buying a Car, TV, Perfume

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BUYING DECISION BEHAVIOR

 Dissonance-reducing Buying Behavior

Consumer buying behavior in situations

characterized by few perceived differences among
brand

E.g Fridge, Refrigerators, Split Units

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BUYING DECISION BEHAVIOR

 Variety Seeking Buying Behavior

Consumer buying behavior in situations

characterized by low consumer involvement but
significant perceived brand differences

E.g Grocery shopping, petrol stations

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BUYING DECISION PROCESS

NEED RECOGNITION

INFORMATION SEARCH

EVALUATION OF ALTERNATIVES

PURCHASE DECISION

POSTPURCHASE BEHVIOR

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BUYING DECISION PROCESS FOR NEW

PRODUCTS (PRODUCT ADOPTION)

 Awareness

 Interest

 Evaluation

 Trial

 Adoption (AIETA)
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BUYING DECISION PROCESS FOR NEW

PRODUCTS (PRODUCT ADOPTION)

ADOPTER CATEGORIES

 INNOVATORS (2.5%)

 EARLY ADOPTERS (13.5%)

 EARLY MAJORITY (34%)

 LATE MAJORITY (34%)

 LAGGARDS (16%)

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UPS Case

pg 169-170

Principles of Marketing 11th

Edition

Anyone can be called to

summarize the case

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FINAL CASE
4Ps and Marketing Communication
Mix of a New Product/Product
Versions
- Select an existing brand (present
in Pakistan)
- Develop a Questionnaire covering
the topic
- Interview Organizations

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FINAL CASE
4Ps and Marketing Communication
Mix of a New Product/Product
Versions
- New Product/Version should not
be more than 6 months old
- 2 per group
- 15 -20 pages report

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Environment Buying Buyer

MODEL OF Organization Responses
BUSINESS
BUYER Marketing The buying -Product/Service Choice
BEHAVIOR Stimuli – Center
4Ps -Supplier Choice
- Order Quantities
Buying Decision
Other Processes - Delivery terms and
Stimuli- times

Economic, - Service terms

-Interpersonal
Political, - Payments
and Individual
Technologic
Influences
al, Cultural,
Competitive - Organizational
Influences

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All the individuals and units that

Buying Center
participate in the business buying
MODEL OF decision process
Members of buying organizations
BUSINESS Users
who will actually use the purchased
BUYER
product
People inor
theservice
organization who
BEHAVIOR Influencers
affect the buying decision; they
often help define specifications and
Buyers also provide information for
People in the
evaluating organization’s buying
alternatives
Deciders center who have formal or informal
power to select or approve the final
supplier
People in the organization’s buying
Gatekeepers
center who control the flow of
information to others

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BUYING DECISION PROCESS

PROBLEM RECOGNITION

GENERAL NEED DESCRIPTION

PERFORMANCE REVIEW

PRODUCT SPECIFICATION

ORDER ROUTINE
SPECIFICATION
SUPPLIER SEARCH

PROPOSAL SOLICITATION SUPPLIER SELECTION

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MARKET
SEGMENTATION

Dividing a market into smaller

TARGET groups of buyers distinct needs,

MARKETING
characteristics or behavior who
might require separate products
MARKET or marketing mixes
POSITIONING

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MARKET Arranging for a product to

SEGMENTATION occupy a clear, distinctive or
desirable place relative to
competing products in the minds
of target consumers

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TARGET
MARKETING

The process of evaluating each

market segment’s attractiveness
and selecting one or more
segments to enter

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MARKET
POSITIONING
Arranging for a product to
occupy a clear, distinctive or
desirable place relative to
competing products in the minds
of target consumers

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MARKET  Geographic
SEGMENTATION Trading Blocks, Nations, Provinces, Cities, Neighborhood

 Demographic
Age, Gender, Family size, Family life cycle, income, occupatio
Education, religion, race, nationality

 Psychographic

Social Class, Lifestyle, Personality characteristics

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MARKET  Behavioral
SEGMENTATION Consumer Knowledge, Attitude, Product Use

 Occasion
Purchasing events, Usage events

 Benefit

Benefit sought

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MARKET  Behavioral
SEGMENTATION Consumer Knowledge, Attitude, Product Use

 User Status
Current user, Ex-user, First-time user,
potential user

 Usage Rate

Light, medium, heavy

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MARKET  Measurable
SEGMENTATION
 Accessible
Requirements for
Effective
Segmentation  Substantial

 Differentiable

 Actionable

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TARGET  Market Size

MARKETING

 Market Growth

 Competition

 Market Orientation
buyer oriented or seller oriented

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TARGET  Undifferentiated marketing

MARKETING A market coverage strategy in which a firm decides to
ignore market segment differences and go after the whole
STRATEGIES market with one offer
 Differentiated marketing
A market coverage strategy in which a firm decides to
target several market segments and designs separate
offers for each
 Concentrated marketing
A market coverage strategy in which a firm goes after a
large share of one or a few segments or niches

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TARGET  Undifferentiated marketing

MARKETING A market coverage strategy in which a firm decides to
ignore market segment differences and go after the whole
STRATEGIES market with one offer
 Differentiated marketing
A market coverage strategy in which a firm decides to
target several market segments and designs separate
offers for each
 Concentrated marketing
A market coverage strategy in which a firm goes after a
large share of one or a few segments or niches

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TARGET  Micromarketing
MARKETING The practice of tailoring products and marketing programs
to the needs and wants of specific individuals and local
STRATEGIES customer groups
 Local marketing
Tailoring brands and promotions to the needs and wants of
local customer groups – cities, neighborhoods, specific stores

 Individual marketing
Tailoring products and marketing programs to the needs and
preferences of individual customers

Developed by IQ Fall 2007 78

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TARGET  Company Resources

MARKETING
STRATEGIES  Product Variability

DECISION  Product Life-cycle stage

FACTORS

 Market Variability

 Competitor’s Marketing Strategy

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POISTIONING The way the product is defined by

consumers on important attributes

The place the product occupies in

consumer’s minds relative to competing
products

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POISTIONING

BYD F-1

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POISTIONING

MG-ROVER MGX80
Developed by IQ Fall 2007 82
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POISTIONING

MG-ROVER MGX80
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POISTIONING Positioning Maps (Perceptual Positioning Map)

Rs. 600,000
Santro

Price Alto
Coure

Mehran

Rs. 300,000

Comfort Style

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POSITIONING Competitive advantage

 Superior Value Quality, Service

 Differentiation

 Product Differentiation
e.g. Chicken, Washing Powder, Shampoo
Head & Shoulders, Pantene
 Service Differentiation
e.g. UPS devices, Desktops, Laptops

Developed by IQ Fall 2007 85

 rke t ing
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pl es o MARKETING OUTLINE
Princi

Krispy Kreme Case

pg 231-232

Principles of Marketing 11th

Edition

Anyone can be called to

summarize the case
Developed by IQ Fall 2007 86
 rke t ing
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4 P’s of Marketing

The Product (features, quality, service, support,

Marketing product line etc.)
Mix
Place (channel of distribution,
exclusive vs. intensive, etc.)

(advertising, sales force,

Promotion brochures, coupons, etc.)

Price (list price, discount, deals, both end-user

and channel)

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Anything that can be offered to a market

for attention, acquisition, use or
Product consumption that might satisfy a want or
a need

Any activity or benefit that one party can

Service offer to another that is essentially
intangible and does not result in the
ownership of anything

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4 P’s of Marketing
Augmented
Product
Product
Actual
Delivery &
Credit
Product After
sales
Brand Features service
Name
Core
Benefit
Design
Quality
Level
Packaging
Warranty
Installation

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4 P’s of Marketing

CONSUMER PRODUCTS
Product 1. Convenience goods
2. Shopping goods
3. Specialty goods
Types 4. Unsought goods

INDUSTRIAL GOODS

Marketing Considerations to Consumer

Productions table 8.1 pg 235, Principles
of Marketing

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4 P’s of Marketing

Product 1. Product Attributes

1. Branding
Product and
Services
Decisons 1. Packaging

1. Labeling

1. Product Support Services

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4 P’s of Marketing

Product 1. Product Features

e.g Shopping Cart

ProductAttrib 1. Product Quality

utes

1. Product Style and Design

e.g Pink Santro Club

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4 P’s of Marketing

Product

ProductAttrib
utes

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4 P’s of Marketing

Product

ProductAttrib
utes

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4 P’s of Marketing

Product

BRANDING 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.

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Product

PACKAGING The activities of designing and producing the container

or wrapper for a product

- Labeling Product information given on package

Nutritional Labeling and Educational Act 1990, FDA

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Product

Product Customer Support Service

Support - Return Policies
Services
- Replacement Policies
- Warranty
- Guarantee

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PRODUCT LINE
Product A group of products that are closely related because
they function in a similar manner, are sold to the same
customer groups, are marketed through the same
types of outlets or fall within given price ranges

PRODUCT MIX
The set of all product lines and items that a particular
seller offers for sale

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BRAND EQUITY
Product The positive differential effect that knowing the
brand name has on customer response to the product
or service

BRAND POSITIONING
- Product Attributes
- Benefits
- Beliefs and Values

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4 P’s of Marketing

BRAND NAME SELECTION

Product - Selection
- Protection

BRAND SPONSORSHIP
- Manufacturer’s brand
- Private brand
- Licensing
- Co-branding

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4 P’s of Marketing

BRAND DEVELOPMENT
Product - Line Extension
- Brand Extension
- Multibrands
- New brands

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4 P’s of Marketing
PRODUCT DEVELOPMENT LIFE CYCLE

Product  Product Idea

 Screening
 Concept Development &Testing
PDLC
 Marketing Strategy
 Business Analysis
 Product / Prototype Development
 Test marketing
 Commercialization
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PRODUCT LIFE CYCLE

Costs are high, Profits

Product  Introduction are low

Profits start and keep

PLC  Growth
growing, Market
share increases

 Maturity
Sales are maximum
then tail-off,
Maximum profits
 Decline
New products replace
products, sales
become low103
Developed by IQ Fall 2007
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PRODUCT LIFE CYCLE

A basic and
Product  Style distinctive model of
expression

PLC A currently accepted

or popular style in a
 Fashion given field

A temporary period of
unusually high sales driven
 Fad by consumer enthusiasm and
immediate product or brand
popularity
Developed by IQ Fall 2007 104
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PRICING

The amount of money charged for a product or

Price service or the sum of the values that consumers
exchange for the benefits of having or using the
product or service
DYNAMIC PRICING

Changing different prices depending

on individual customers and situations

Developed by IQ Fall 2007 105

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4 P’s of Marketing
FACTORS EFFECTING PRICING DECISIONS

Internal Factors
Price
 Marketing Objectives - Depends on PLC
 Survival, Current Profit Maximization,
Market Share leadership, Product Quality
Leadership

Marketing Mix Strategy – Depends on PLC

 Target Costing
 Costs
 Elasticity of Demand, Elasticity of Price
 Organizational considerations
Developed by IQ Fall 2007 106
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4 P’s of Marketing
FACTORS EFFECTING PRICING DECISIONS

External Factors
Price
 Nature of the market and demand

 Competition

 Other environmental factors

(economy, resellers and government)

Developed by IQ Fall 2007 107

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4 P’s of Marketing
PRICING APPROACHES

Price  Cost based Pricing

 Cost Plus pricing – Add standard
profit (mark-up) to the cost of the
product

 Break-Even Analysis and Target Profit

Pricing

 Value-based pricing
Setting Developed
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NEW-PRODUCT PRICING STRATEGIES

Price  Market Skimming Pricing

Selling a high price for a new product to
skim maximum revenues layer by layer
from the segments willing to pay the high
price
- Fewer but more profitable sales

 Market-Penetration Pricing
Setting a low price for a new product in
order to attract large number of buyers
Developed by IQ Fall 2007 109
and a large market share
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4 P’s of Marketing
PRODUCT MIX PRICING STRATEGIES

Price  Product Line Pricing

Setting the price steps between various
products in a product line based on cost
differences between the products,
customer evaluations of different features
and competitor’s prices

 Optional-Product Pricing
The pricing of optional or accessory
products along with a main product
Developed by IQ Fall 2007 110
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4 P’s of Marketing
PRODUCT MIX PRICING STRATEGIES

Price  Captive Product Pricing

Setting a price for products that must be
used along with a main product e.g blades
for razors, cartridges for printers

 By-Product Pricing
Setting a price for by products in order to
make the main product’s price more
competitive

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PRICE ADJUSTMENT STRATEGIES

Price  Discount
 Allowance
 Segmented Pricing
 Psychological
 Geographical
 Promotional
International

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4 P’s of Marketing

Place  Distribution or Supply Chain

Management

 Retailing and Wholesaling

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4 P’s of Marketing
Distribution or Supply Chain Management
Value Delivery Network:
Place
The network made up of the company.
Suppliers, distributors and eventually
customers who partner with each other to
improve the performance of the entire
system

Marketing Channel or Distribution

Channel:
A set of interdependent organizations in
the process of making a product or
Developedfor
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or consumption
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Distribution or Supply Chain Management
Marketing Channel or Distribution
Place Channel:
Producer Producer Producer
InDirect
Marketing
InDirect Channel
Direct Wholesaler
Marketing
Marketing
Channel
Channel

Retailer Retailer

Consumer Consumer Consumer

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Distribution or Supply Chain Management
Conventional Distribution Channel:
Place
A channel consisting of one or more
independent producers, wholesalers and
retailers, each a a separate organization
seeking to maximize its own profits even
at the expense of profits for the system as
a whole
Vertical Marketing System (VMS):
A distribution channel structure in which
producers, wholesalers and retailers act
as a united system. One channel member
owns the others,
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Fall 2007 with them
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or has so much power that they all
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Distribution or Supply Chain Management
Horizontal Marketing System:
Place
A channel arrangement in which two or
more companies at one level join together
to follow a new marketing opportunity
Multichannel distributin system or hybrid
marketing channel:
A distribution system in which a single
firm sets up two or more marketing
channels to reach one or more customer
segments

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Distribution or Supply Chain Management
Marketing Logistics:
Place
A channel arrangement in which two or
more companies at one level join together
to follow a new marketing opportunity
Supply Chain Management:
A distribution system in which a single
firm sets up two or more marketing
channels to reach one or more customer
segments

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 rke t ing
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Princi

MARKETING
COMMUNICATION MIX
1. Advertising
2. Sales Promotion
3. Public Relations
4. Personal Selling
5. Direct Marketing

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