COMM 103 Lecture Notes - Lecture 7: Value Proposition, Pricing Strategies, Marketing Mix
3 Nov 2016
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CHAPTER 11: UNDERSTANDING THE MARKETING EFFORT
FOUR PILLARS OF THE MARKETING EFFORT
• Marketing mix: organization's strategic and tactical decisions relating to its
product/service offering pricing, distribution, and marketing communication efforts
and approaches
o Historically referred to as the four P's of marketing (product, price, place-->
distribution, promotion--> communication)
• Four pillars of the marketing effort (marketing mix)
1. Communication strategy
2. Product strategy
3. Pricing strategy
4. Distribution strategy
Product Strategy: Value Proposition Attributes versus Product Attributes
• Viewing the product strategy as that of value proposition attributes brings into play
a considerably broader range of attributes that can be used to more fully align the
organization's offering to the needs of the target market and create greater
opportunity for differentiation
• Value proposition strategies
o Viewing product strategies as the development of value proposition attributes
shifts the marketing team's focus from simply "building a better mouse trap" to
creating positive performance gaps between the company and its competitors
o r
o Eg. Netflix value proposition = convenience
• The power of brands
o A brand that carries emotional ties and strong intrinsic value into a value
proposition greatly improves the chances for its success
o What makes a brand powerful is its ability to move its customer market
beyond simple awareness of the brand itself to a level of commitment
unmatched by competitors
o Truly successful brands, which add power to a company and its
product/service, are those that have evolved to the top end of the brand
ladder
• Brand latter
• Predetermined Purchase List: ranking of product/service that purchasers make
when making a purchase decision
o Must connect with customers on 3 levels: product attributes, benefits,
emotional ties
Pricing Strategy: Return on Sales Maximization
find more resources at oneclass.com
find more resources at oneclass.com
Document Summary
Indirect distribution: use of a channel intermediary to facilitate the sales of an organization"s product/service: eg. Homeowner hires a real estate agent to facilitate the sale: mixed distribution: incorporate both direct and indirect distribution options, eg. Dell sells products in store and through walmart: product/service delivery options, private label brands: products created by one company for sale by another company under this latter company"s own brand name, eg. Sears: multi-channel distribution: incorporation of different channel connections through which customers can purchase a product or service, eg. Coach: degree of sales support within the channel. Intensive distribution: maximize product availability in the marketplace by distributing it through as many channels as possible: eg. Convenience goods: product/service we see every day like sodas: selective distribution: sell product/service through a limited number of channel intermediaries, eg. No coach bags at walmart or target: exclusive distribution: focus on distribution of products through a single channel, eg.
