Marketing mix is the set of controllable marketing variables that the firm blends to produce the response it wants in the target market. It is a combination of marketing tools know as four P’s inappropriate dimension that will influence the behaviour of the market in a desired direction. The four P’s (4Ps) are: product, price, place and promotion.
Product
Product stands for the goods and services or ideas the company offers to the target market. A product is defined as anything that can be offered to a market for attention, acquisition, use or consumption that might satisfy a need or want.
It includes physical objects, services, persons, places organisations and ideas (AMA 1960). Product strategy calls for marking coordinated decision on product items, product lines and the product mix.
Each product item offered to customers can be looked at on three levels the core product, actual product, and augmented product levels.
The core product is the essential service the buyer is really buying. The actual product is the features, styling, quality, brand name and packaging of the product being offered for sale. The augmented product is the actual product plus the various services offered with it such as warranty, installation, maintenance and free delivery.
Classifying Products
Products fall into one of two general categories Products purchased to satisfy personal and family needs are consumer products. Those bought for use in a firm’s operations or to make other products are industrial products.
The same item can be a consumer product and an industrial product. The buyer’s intent as a consumer and industry products. The main reason we classify is that classes of products are aimed at particular target markets, and this affects distribution, promotion and pricing decisions. More so, the types of market activities and efforts needed differ among these classes of consumer or industrial products.
Consumer Products
The most widely accepted approach to classifying consumer products relies on the common characteristics of consumer buying behaviour.
It divides products into four categories namely: convenience, shopping, specialty and unsought products. However, not all buyers behave in the same way when purchasing a specific type of product. Thus a single product can fit into all four categories.
Convenience Products
These are relatively inexpensive, frequently purchased items on which buyers. exert minimal purchasing effort, e.g., bread, soft drinks, tooth pastes, etc. The consumer spends time planning the purchase or comparing available brands or sellers,
Shopping Products
These are items on which buyers are willing to expand considerable effort in planning and making the purchase. Buyers allocate time for comparing stores and brands with respect to prices, product features, qualities, services etc e.g appliances, furniture, bicycles etc. These products are expected to last a fairly long and thus are purchased less frequently
Specialty products possess one or more unique characteristics, and significant group of buyers is willing to expend considerable effort to obtain them. Buyers actually plan the purchase; they know exactly what they want and will not accept a substitute. They are purchased less frequently and are often distributed through a limited number of outlets e.g jaguar car
Unsought Products
These are purchased when a sudden problem must be solved or when aggressive rig is used to obtain a sale that otherwise would not take place e.g emergency car repairs.
Industrial Products
Industrial products are usually purchased on the basis of an organisation’s goals and objectives. Generally, the functional aspects of the product are more important than psychological rewards sometimes associated with consumer products.
Industrial product can be classified into seven categories according to their characteristics and intended uses; raw materials, major equipment, accessory equipment, component parts. process materials, consumable supplies and industrial services.
Price
To a buyer, price is the value placed on what-is exchanged. Something of value is exchanged for satisfaction or utility usually buying power. Buyers’ interest in price stems from their expectations about the usefulness of a product or the satisfaction they may derive from it. Buyers must decide whether the utility gained in an exchange is worth the buying power sacrificed.
Pricing Objectives
Pricing objectives are overall goals that describe what the firm wants to achieve through its pricing efforts. Because pricing objectives influence decisions in most functional areas, the objectives must be consistent with the organisation’s Overall mission and purpose. A few of the pricing objectives are:-
1. It is used as a survival strategy
2. It can be used to maximize profit
3. It can be used as a measure of return on investment (ROI)
4. It is also used to increase market share via a reduction in price
5. It can also be used to maintain cash flow
6. It can be used to maintain status quo
7. It is used as a measure of product quality
Promotion
Modern marketing calls for more than developing a good product, pricing it attractively, and making it available to target customers. Companies must also communicate With their customers. What is communicated, however, should not be left to chance. The marketing communications mix (also called the promotion mix) consists of four major tools.
1. Advertising Any paid form of non personal presentation and promotion of ideas, goods or services by an identified sponsor.
2 Sales promotion Short term incentives to encourage purchase or sales of a product or service.
3. Personal Selling – Oral presentation in a conversation with one or more prospective purchasers for the purpose of marketing sales.
4. Publicity and Public Relations – Publicity is a non-personal communication in news and/or its products, that is transmitted through a mass medium at no charge. Public relations is a broad set of communication activities used to create and maintain favourable relationship between the organization and its public, such as customers employees, stockholders, government officials, and society in general.The role of promotion is to communicate with individuals, groups, or organizations so as to directly facilitate exchanges by informing and persuading and reminding one or more of the audiences to accept an organization’s products.
Place (Distribution)
A distribution channel is the set of firms and individuals that take title, or assists in transferring title, to a good or services as it moves from the producers to the final consumer or industrial user.
Distribution channel decisions are among the most complex and challenging decisions facing the firm. Each channel system creates a different level of sales and costs. Each firm needs to identify alternative ways to reach the market. They vary from direct selling to using one, two, three or more intermediary channel level as shown below:
Note:-
M= Manufacturer
W = Wholesalers
R = Retailers
C = Consumers
Channel design calls for identifying the major channel alternatives in terms of types of intermediaries, the number of intermediaries- and the channel responsibilities. Each channel alternative has to be evaluated according to economic, control and adaptive criteria. Channel management calls for selecting qualified middlemen and motivating them.
Individual channel member must be evaluated regularly against their own past- sales and other channel members’ sales. Firms must pay attention to physical distribution. Physical distribution is an area of potentially high cost savings and improved customer satisfaction. When order processors, warehouse planners, inventory managers, and transportation managers make decisions, they affect each other’s costs and ability to handle demand.
The physical distribution strategy calls for treating all these decisions within a unified-framework, The task is to design physical distribution system that minimise the total cost of providing A desired level of customer services.
Functions of Intermediaries
Critics who suggest that eliminating intermediaries would lower prices for consumers do not recognise that this would not eliminate the need for the services intermediaries provide. Other institutions would have to perform those services and consumers would still have to find them.
In addition, all producers would have to deal directly with consumers, meaning that every producer would have to keep voluminous records and hire enough personnel to deal with every customer. Intermediaries facilitate exchanges by solving the problems of discrepancy in quantity and discrepancy in assortment.
Discrepancy in quantity is created because the quantity of a product particular firm can produce efficiently is more than the customer wants. There is a discrepancy in assortant because a consumer wants a broad assortment, but an individual manufacturer produces a narrow assortment.
Quantity and assortment discrepancies are resolved through the sorting activities of intermediaries in a marketing channel. Sorting activities are functions that allow channel members to divide roles and separate tasks. Sorting activities maybe grouped into four main tasks: Sorting out, accumulation, allocation and assorting of products.
Sorting Out
the first step in developing an assortment is the separating of conglomerates heterogeneous products into relatively uniform, homogenous groups based on product characteristics such as Size, shape, weight, or colour.
Accumulation
is the development of a bank or inventory of homogenous products that have similar production or demand requirements. It enables intermediaries to build up specialised inventories and allocate products according to customers’ needs.
Allocation
Is the breaking down of large homogenous inventories into smaller lots: This process, which addresses discrepancies in quantity, enables wholesalers to buy efficiently in lorry or container loads and then apportion products by cases to other channel members
Assorting
Is the process of combining products into collections or assortments that buyers want to have available in one place. Assorting eliminates discrepancies in assortment by grouping products in ways that satisfy buyers. Assorting is especially important to retailers and they strive to create assortments that match the demands of consumers who patronise their stores.
Marketing Management Philosophies
Since marketing management has been described as carrying out tasks to achieve desired exchanges with target markets, philosophies should guide this marketing effort’? What weight should be given to the interests of the organization, customers and society? Very often their interest conflict.
Clearly, marketing activities should be carried out under some philosophies that would ensure A balance in the interest. There are five competing concepts under which organizations conduct their marketing activity: the production, product, selling marketing and societal marketing concept.
The Production Concept.
The Production concept holds that consumer will favour products that are available and highly affordable and therefore management should focus on improving production and distribution-efficiency.
The production concept is a proper philosophy in two situations, the first is where the demand for a product is bigger than the supply, here management should look for ways to increase production.
The second situation is where the product’s cost is high and improved production is needed to bring it down. Implicit in the production concept are the following:
- i. Product availability at low price is the main concern of the customers
- ii. Consumer are price sensitive and pay less attention to non-price differences within the product class.
The Marketing Concept
The marketing concept holds that achieving organizational goals depends on determining the needs and wants of targets market and delivering the desired satisfactions more effectively than competitors.
The marketing concept holds that customers should be held as “kings” and that all organizations efforts should be directed at identifying an satisfying the customers’ needs and wants. It emphasises making what one can sell instead, of trying to sell what one can make. Implicit in the marketing concept are:
1. Consumer have different needs and want and that consumer can be grouped into various market segments on the basis.
2. Consumers will buy the product of the organization that are best fitted to satisfy their specific needs and wants.
3. The organization’s task is to identify these needs and wants through research and choose target markets which it can satisfying the most effective and efficient manner.
4. Consumers should be seen as “the king” in the operations of firms.
The Societal Marketing Concept
The social marketing concept holds that the organization should determine the needs, wants and interest of target markets and deliver the desired satisfactions more effectively and efficiently than competitors in a way that maintains or improves the consumer’s and the society’s well being
The societal marketing concept questions whether the pure marketing concept is adequate in an age of environmental. problems, resource shortages, rapid population growth, worldwide and neglected social services. It asks if the firm that senses, services, and satisfies individual want is always doing what’s best for consumers and society in the long run.
The pure marketing concept ignores possible conflicts between short-run consumer wants and long-run consumer welfare. The societal marketing concept calls for balancing all these three considerations – company profits, consumer want and society’s interest. Implicit in the societal marketing concept are:
- i. Consumer’s needs and want will first be identified before production
- ii. The interest of both consumers and the firm must be balanced in the Company’s activities for the long-run societal well being.
- iii. Only the products that are safe will be produced and marketed.
- iv. The long-run societal well being must be the watchword of companies.
Elements of Marketing Mix
Marketing mix is the set of controllable variable that the firm blends to produce the response it want in the target, it is a combination of marketing tools known as four ps in appropriate dimension that will influence the behaviour of the market in A desired direction, the four ps, (4Ps) are product, price, promotion and place.
Product stands for the goods and service or ideas the company offers to the target market. A product is define as anything that can be offered to A market for attention, acquisition, use or consumption that might satisfy A need or want. It includes physical objects, services, person places organization and ideas. Product strategy calls for making co-ordinate decision on items, product lines, and the product mix
Price
To buyer, price is the value on what is exchanged, something of value is exchange for satisfaction or utility-buying power. Buyer interest in price stem from their expectation about the usefulness of a product or the satisfaction they may derive from it. Buyer must decide whether the utility gained in an exchange is worth the buying power sacrificed,
Pricing Objectives
Pricing objectives are overall goals that describe what the firm wants to achieve through its pricing efforts. Because pricing objectives, influence decision most functional areas, the objectives must be consistent with the organization overall mission and purpose. A few of the pricing objectives are:
1. It is used as a survival strategy
2. It can be used to maximise profit.
3. It can be as a means of return on investment (ROI)
4. It can also be used to increase a cashflow.
5. It can be used as a measure of product quality, and
6. It can also be used to maintain a status quo.
Promotion
Modern marketing calls for more than developing a good product, pricing it attractively, and making it available to large customers. Company must also communicate with customers.
What is communicated however, should not be left, to chance. The marketing communication mix (also called the promotion mix) consist of four tools.
Advertising any paid form of non-personal presentation and promotion of ideas, goods or services by an identified sponsor. Sales promotion- short term incentives to encourages or sales of product or services. Personal selling-Oral presentation in a conversation with one or more prospective purchaser for the purpose of making sales.