Food Marketing and Product Development

By Chay Kongkruy,
Vice-Dean of Faculty of Agro-Industry,
International Master of Sciences in Rural Development

Tel: 012 416 096/0979 729269

Email:chay_k_k@yahoo.com

Chapter 1
Introduction
to Food Marketing

Marketing Defined
The performance of all business activities
involved in the flow of food products and
services from the Point of initial
agricultural production until they are in the
hand of consumer

Food Flow and

Marketing

What is marketing ?
Production prices product relationships product
promotion publicity supply and demand distribution
manage to sell selling exchange offer for sale
the consumer bringing products to the market the
flow of goods presentation packaging affordable
price market research answering questions

Marketing =
many different meanings to different people

Marketing is according to you

What is marketing?
Activities to satisfy consumer needs
Right product at the right price, place and time
Right = what is right for the consumer /
customer
Marketing management = Managerial process:

Analysis
Planning
Strategy
Implementation
Control

What is marketing?
Western Europe, 1950s:
shortage of products / foods
no need for stimulating demand
focus on efficiency of marketing functions
storage
transportation
processing
distribution
1970s: role of institutions
government
marketing institutions: auctions, cooperatives
7

What is marketing?

Todays Rich Society:

Need for quality instead of quantity
Need for variation
New products, differentiation

Marketing Management approach

Customer orientation
customer / consumer is key and center
fulfillment of consumer needs
8

The core concepts of marketing

Needs, wants and demand

Products
Value, cost and satisfaction
Exchange, transactions and
relationships
Markets
Marketing and marketers
9

The core concepts of marketing

Need: state of feeling of scarcity

Want: desire for specific satisfier
Demand: want backed up by spending
power and willingness to pay
Product:
Offers satisfaction to need or want
Physical product or service

Value: estimate of the capacity to satisfy a

need
10

The core concepts of marketing

Exchange: one way to obtain a product

Two parties
Things of value for both parties
Communication and delivery
Freedom to accept or reject
Belief in appropriateness to deal

Market:
Group of people sharing same need/want
Willing and able to engage in exchange
Aim: satisfy the need or want
11

The core concepts of marketing

Marketer:
Party seeking exchange more actively
Counterpart = prospect

12

Marketing Concept versus Selling Concept

Starting
point

Focus

Company

Products

Means

Ends

Selling and
Profits through
promoting
sales volume

(a) The selling concept

Market

Customer
needs

Coordinated
marketing

Profits through
customer
satisfaction

(a) The marketing concept

13

Company orientations

Production orientation:
Product availability is major attention point
Low cost
High production efficiency

Product orientation:
Product quality
Good products, improve products

Selling orientation:
Selling and promotion efforts
14

Company orientations

Marketing orientation:
Core = Needs and want of target markets
Aim = Deliver satisfaction
Through 4 pillars:
Market focus
Customer orientation
Coordinated effort
Profitability
15

The marketing concept

1. Customer oriented / Market focused
2. Coordinated effort
3. Profit oriented
Market orientation
Consumers needs
Food companies

Production orientation
Produce more
Farming businesses

4 parts marketing mix

16

4 pillars of the marketing concept

1. Market Focus
Nobody can satisfy every need
Choose your target market

2. Customer orientation
Define need from customer viewpoint
Realize customer retention
Through customer satisfaction
Maximize opportunity to complain
17

4 pillars of the marketing concept

3. Coordinated effort
Among marketing functions
With other company departments

4. Profitability
Make profit to stay in business
By satisfying better than competitors do

18

The marketing concept

1. Customer oriented
2. Market focused
3. Coordinated effort
4. Profit oriented
Combine 4 Ps towards optimal results:

PRODUCT
PRICE
PROMOTION / Communication
PLACE OF DISTRIBUTION
19

Example in Fisheries Marketing

20

21

22

Introduction of Marketing and

Consumers Behavious

24

25

26

Driving forces to adapt the marketing

concept

Sales decline : stabilization of population size

Slow growth : food market 2-3% per year
Changing buying patterns : quality, convenience,
variety

Increasing competition : food / non-food, out of home,

global

27

The Value ChainAn Example

CORN
GROWER

SLAUGHTER
HOUSE

HOG
FARMER

FOOD
MANUFACRURER

MARKET RESEARCH
BRAND MANAGEMENT
ADVERTISING/PROMOTION

AUCTION
HOUSE

WHOLESALER

GROCERY
STORE

The Value Chain

Different parties
Add different kinds of value based on
Specialization (e.g., growing, processing,
distributing)
Location

May undertake marketing activities

individually and/or jointly

The Changing Food Marketing System

Laws and
Government
Policies

Customs and
Values

Domestic
and Global
Economy

FARM PRODUCTS

The Food Marketing System:

Firms, Organizations
Product Flows, Distribution Channels
Management and Marketing Activities
Pricing and Exchange

Science and
Technology

Competition
Infrastructure (transport..,
communication, educ.)

FOOD PRODUCTS

Consumer
Tastes
and Preferences

Text, figure 1-3. Copyright 2001 Prentice-Hall.

Market

Location
Product
Time
An institutional

Value added
Form

Form

Place

Place and forms

Time

Possession

Marketing process
Movement: It is the series of actions and
events that take place in some sequence

Coordination: It is the series of events

and activates is necessary if goods are to
move in some of orderly fashion from the
farm to the fork

Movements

Movements

Coordination
Pricing

Coordination

Various arrangement
Contact producers
Terminal market
Trade Assoc
Marketing news