BUSN 70 Chapter Notes - Chapter 12: Business Analysis, Market Segmentation, Integrated Marketing Communications

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The Marketing Mix
Part of the marketing strategy involving decisions regarding
controllable variables
i.
I)
Product Strategy
Developing New Products
Multi-step process before introducing a product
1)
Idea Development
Come from marketing research, engineers, and outside
sources such as advertising agencies and management
consultants
1)
i.
New Idea Screening
Marketing managers look at the organization's resources and
objectives and assess the firm's ability to produce and market
the product
1)
Products succeed because they solve a problem better than
an existing product or they add variety to the product
selection
2)
ii.
Business Analysis
Basic assessment of a product's compatibility in the
marketplace and its potential profitability
1)
iii.
Product Development
iv.
Test Marketing
A trial mini-launch of a product in limited areas that represent
the potential market
1)
v.
Commercialization
The full introduction of a complete marketing strategy and
the launch of the product for commercial success
1)
Firm gears up for full-scale production, distribution, and
promotion
2)
vi.
a.
Classifying Products
Consumer Products - Household or family use; they are not
intended for any purpose other than daily living
1)
b.
II)
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Consumer Products - Household or family use; they are not
intended for any purpose other than daily living
Convenience Products - bought frequently, without a
lengthy search, and often for immediate consumption
a)
Shopping Products - Purchased after the consumer has
compared competitive products
b)
Specialty Products - consumers know what they want
and go out of their way to find it
c)
Business Products - Used directly or indirectly in the operation
or manufacturing process of businesses
Raw materials
a)
Major equipment
b)
Accessory equipment
c)
Component parts
d)
Processed materials
e)
Supplies
f)
Industrial service
g)
2)
Product Line and Product Mix
Product Line - is a group of closely related products that are
treated as a unit because of a similar marketing strategy
1)
Product Mix - all the products offered by an organization
2)
c.
Product Life Cycle
Introductory Stage
Consumer awareness and acceptance of the product
are limited, sales are zero, and profits are negative
a)
Profits still negative because the firm has spent money
on research, development, and marketing to launch the
product
b)
1)
Growth Stage
Sales increase rapidly and profits peak, then start to
decline
a)
New companies enter market, drive prices down and
increasing marketing expenses
b)
2)
Maturity Stage
Sales curve peaks and starts to decline while profits
continue to decline
a)
Severe competition and heavy expenditures
b)
3)
Decline Stage
Sales continue to fall rapidly
a)
Profits also decline and may even become losses as
prices are cut and necessary marketing expenditures
are made
b)
4)
d.
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Profits also decline and may even become losses as
prices are cut and necessary marketing expenditures
are made
Identifying Products
Branding
The process of naming and identifying products
1)
Brand - a name, term, symbol, or design or combination that
identifies a product and distinguishes it from other products
2)
Trademark - a brand that is registered with the US Patent and
Trademark Office and is thus legally protected from use by
any other firm
3)
Manufacturer Brands - brands initiated and owned by the
manufacturer to identify products from the point of
production to the point of purchase
4)
Private Distributor Brands - may be less expensive than
manufacturer brands, they are owned and controlled by a
wholesaler or retailer
5)
Generic Products - no brand name at all
6)
i.
Packaging
External container that holds and describes the product,
influences consumers' attitudes and their buying decisions
1)
Can provide protection, convenience, promotion etc.
2)
ii.
Labeling
Presentation of important information on the package, and is
closely associated with packaging
1)
Often required by law, includes ingredients or content,
nutritional facts, care instructions, suggestions for use,
manufacturers address etc.
2)
iii.
Product Quality
Reflects the degree to which a good, service, or idea meets
the demands and requirements of the customer
1)
Difficult to gauge because it depends on the customers'
perception of how well the service meets or exceeds their
expectations
2)
iv.
e.
Pricing Strategy
Price is a key element in the marketing mix because it relates
directly to generation of revenue and profits
i.
Pricing Objectives
Specify the role of price in an organization's marketing mix
and strategy
1)
a.
III)
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Document Summary

Part of the marketing strategy involving decisions regarding controllable variables. Come from marketing research, engineers, and outside sources such as advertising agencies and management consultants ii. Marketing managers look at the organization"s resources and objectives and assess the firm"s ability to produce and market the product. Products succeed because they solve a problem better than an existing product or they add variety to the product selection iii. Basic assessment of a product"s compatibility in the marketplace and its potential profitability iv. v. A trial mini-launch of a product in limited areas that represent the potential market vi. The full introduction of a complete marketing strategy and the launch of the product for commercial success. Firm gears up for full-scale production, distribution, and promotion b. Consumer products - household or family use; they are not intended for any purpose other than daily living intended for any purpose other than daily living a) b) c)

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