Product Marketing: MARKETING IS ANY BUSINESS ACTIVITY THAT IS DESIGNED TO: PLAN PRICE PROMOTE DISTRIBUTE WANT SATISFYING PRODUCTS, SERVICES AND IDEAS TO TARGET MARKETS SO THAT AN ORGANISATION CAN ACHIEVE ITS OBJECTIVES. * IDENTIFY CUSTOMERS * ATTRACT THEIR ATTENTION * SATISFY WANTS Product Marketing: - Definition "The essential element of marketing is customer want satisfaction .... the customer's want satisfaction is the economic and social reason for an organisations existence." The Marketing Plan: - Definition ".... a document prepared for the purpose of providing guidelines for a business units marketing programmes and allocations over a prescribed planning period." Marketing Planning Definiton: Is vital for all successful companies because the business environment is highly complex, dynamic, and competitive. Marketing and market planning is relevant to large and small organisations in both public and private sectors. Acronyms: Market Segmentation: Marketing Mix: Macro environment: A ccesible P roduct P olitical I dentifiable P rice E conomic M easurable P lacing S ocial S izeable P romotion T echnological Proximate environment: C ustomer R esources I ndustry C ompetitors The Marketing Plan: 1.Market Research: - Situation Analysis - A situation analysis, is broken down into several different areas. These are: SWOT Analysis, Customer Analysis (to establish a target market), Competitor Appraisal, and Resource Analysis. - The business must make a Situational Analysis based on the influences of the Macro environment, as well as the proximate environment - Market Segmentation (target market) involves deviding up groups of people into buyers of certain products/services A. Customer Analysis: A target market can be established by looking at the following factors: * Where it is accesible (both the product and message) * The demography (the population in a group or area(s)) of an assortment of places * What size should the market be - In numbers (Sizeable) - And in boundaries (Measurable) * What are the identifiable factors of this market (how it differs to other target markets) * Psychographically - Lifestyle based/image of the target market * Geographically - Which regions/areas * Benefit - Focus on the benefit the product provides, for this target market, not on the customer characteristics * Size - Frequency of use/level of demand in the target market, being either heavy, medium, or light * Using the above factors in formulating a group which satisfy all of the above points, you have now established a target market B. Competitor Appraisal: Once a target market has been established you must then analyse the competition (if any). There two three types of competition a company can have: 1. Direct Competition - When one business aproaches the customers of another business and attempts to win them over. This only happens when two or more companies are producing the same product 2. Substitute Products - Another type of competition which can come from one company producing a substitute product of another companies product line Competitor Monitoring: This is a vital part of the market research. The best form of competitor monitoring, is to calculate their market share by estimating the total value of the market. If a competitor is gaining a greater market share, it is time for the company to re-organise their marketing plan - Competitive advantage refers to all things an organisation can do better than it's competitors C. Resource Analysis: Once you have completed a competitor appraisal you must then do a resource analysis. The businesses resources are broken down into three areas, these are: 1. Staff - The marketing plan should analyse the skills of every employee involved in marketing. Your staff should be promoting the image you wish the public to think of the company. They should be well trained in areas such as the art of selling, good customer relations, and more. The people should have the following skills: Alertness, good knowledge of product, good appearance, good communication skills, and dedication to maintain the product in a competitive environment 2. Finance - Finance is needed for different methods of advertising or promoting the product. These needs vary according to the life cycle of the business. Finance is necessary for the promotion or development of new products 3. Assets - The fixed assets of a business will determine the capacity of the production system. A successful product can be stopped from greater production if resources are at full usage. The marketing plan should recognise: * The availability of assets * The degree of utilisation of assets D. SWOT Analysis: This needless to say means an analysis of the: Strengths - which areas a business excells compared to it's competitors Weaknesses - which areas other businesses has to improve on in relation to it's competitors Opportunities - All things which benefit the business Threats - All things which can threaten a businesses survival, or a product's survival Aspects which influence a SWOT analysis are: - Market share - Sales - Profits - Competition - Advertising - Size of customer base - Pricing - Innovative potential. - Product characteristics (company reputation, price, design, colour uniqueness, quality, warranty, packaging, sales support, and positioning in market) 2. Objectives and Stratergies: A. Specific Objectives: Establishing objectives it is usually thought of as the most important in the planning process. The success and failure of a marketing plan are determined by how well the marketing objective reflects the organisations needs. Therefore it is vital objectives are set based around the companies overall goals. This is reflected in the diagram below: Goals | Opportunities | Resources |________ Marketing ________| Objectives ____________ | ____________ Diagram of the | Marketing Stratergies | Objectives of a | (Marketing program) | Business |--------------------------| | Selection | Development | | & analysis | of Marketing| | of target | Mixes | | market | | |____________|_____________| - Essential marketing objectives include the following: * Increasing market share * Expanding product range * Targeting the geographical representation * And expansion of marketing opportunities 1. Market share: An increase in a companies market share shows how the company is gaining on competitors. To attain greater market share, the following stratergies, which are generally thought of as sure winners include: * More agressive pricing (lowering price or providing discounts) * Search for new outlets to distribute your products to * A change in some features of your products, to open up to a possibly wider market 2. Product Range: By expansion of a companies product range, a company can attract a wider market than it's inital market, and maybe also expand into other markets 3. Geographical Representation: Some geographical markets offer greater market potential than others, and is in the intrests of the firm to invest there to reach these markets wether they be regional, national or international. This allows a company to maximise on it's profits 4. Expansion: (I) Through exporting (II) Maximizing customer service B. Stratergies to achieve objectives: Marketing stratergies are the way marketing objectives are achieved. Development of a stratergy involves: - Selecting and analysing a target market - Creating and maintaining a marketing mix - Creation of advertising and promotional ideas When properly implemented firm achieves objectives. Selection and analysing of: 1. Target market: This area must be seperated into three areas, as different areas have different needs, these areas are: (I) Retail market (II) Wholesale market (III) Industrial market Creating and maintaining of: 2. Marketing Mix: This broken down into the four P's, they are: Marketing Mix - Breakdown: PRODUCT: PRICE: PROMOTION: Quality R.R.P. (List Price) Advertising Features Bulk Discounts Personal/Direct Selling Options Other Discounts?/Offers?? Sales Promotions Style Allowances Publicity Brand Name Payment Period Packaging Credit Terms PLACE: Sizes Transport Service Channels Warranties Coverage Returns Locations Positioning Inventory An additional part of the marketing mix now exists, it is called 'Service'. Factors here include: * Customer Needs * Installation, Maintenance, and * Guarantees/Warranty - repairs - period * After-sales Service * Complaints & returns * Comparison to competitors - procedures * Credit offered Creation of: 3. Advertising and Promotions: Once the marketing mix has been established, the companies promotional aspects have now to be completed, these can be made up of plans to do: Advertising Personal or direct selling Sales Promotion Publicity (Public relations) Packaging and design 4. Staff Motivation: The effectiveness of the companies market will depend heavily upon the staff, and their degree of motivation. C. Cost/Benefit Analysis: As plans and objectives are developed, statements should be produced which should say what the marketing stratergy is to accomplish. There are two ways of evaluating the actual peformance of these plans, these are sales analysis and cost analysis. 1. Sales Analysis: Sales is usually the best way to measure the performance of a marketing plan. This analysis should be broken down into: - Marketing area (geographical) - Company devision (eg. NSW devision) - Individual/Groups of sales representatives (Quota of sales Vs's Individual/Group's sale) 2. Cost Analysis: This is a detailed study of the business's operating section of the organisation's profit and loss statement. With cost analysis costs which occured as a result of the marketing sector of a business are declared as profitable or unprofitable. This can be broken down into: (I) Research costs (II) Order-getting costs (Promotional costs) (III) Order-filling costs (Distribution and insurance costs) Additional Notes on Marketing Plan: - Strategic Marketing plan is usually a 3 year plan (sometimes 5 year plan). It is concerned with positioning the organisation in it's marketing environment in relation to it's competitors - Tactical Operational Marketing Plan contains detailed costings, scheduling and specific things which need to be achieved to achieve the objectives for each year of the strategic plan - Marketing is an essential function for all businesses. It covers all aspects of a business's operations. The process of marketing involves: 1. Communicating with the public at large on what products/services are available for sale from the company 2. Attracting the public to Point-Of-Sale 3. And lastly, Achieving the sales Every business must sell it's products or services to survive today, as well as how others have done so in the past. Marketing Plan overview: It involves: 1 - Look at Objectives 2 - Conducting a Situation Analysis 3 - Conducting a Financial Analysis 4 - Setting objectives for Marketing Plan 5 - Formulating a Stratergy to achieve objectives 6 - Formulating tactics to implement the stratergy 5 - Establishing Controls (for monitoring procedures) Study Notes: - Be able to devise a marketing plan - Know examples of a marketing plan - Know the role of Marketing / Marketing Plan - Know the difference between Sales and Marketing
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