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In this sense, a firm's m marketing department is often seen as of prime importance within the co functional level of an organization. Information from an organization's marketing department would be used e. As an example, re a marketing department could ascertain via marketing research that consumers desired a new type of product, or a new usage for an existing ef product. The production department would then start to manufacture the good, llo while the marketing department would focus on the promotion,.

Additionally, a firm's finance department would be consulted, with respect to securing appropriate w funding for the development, production and promotion of the product. Private firms should achieve profits only as a consequence of creating superior customer value, by satisfying customer needs better than competitors.

Emphasis is placed on the needs. Company first determines 2. Company first makes the product customer needs then decides then decides on how to sell it. Management is sales volume satisfy the needs oriented. Management is profit oriented. Planning is short term oriented, 4. Planning is long term oriented in in terms of current markets and terms of new products, markets products.

Focus is on the needs of the 5. Focus is on the wants of the m seller. Product planning to match re 7. High pressure selling to sell products with demand. Profits are through customer nl 9. Profits are through sales volume. Thus holistic marketing is an approach to marketing that attempts to recognize and reconcile the scope and complexities of marketing activities.

There are four components of the holistic marketing concept, i. Relationship marketing ii. Integrated marketing iii.

Internal marketing iv. It has the aim of building and mutually satisfying long term relationships with key parties i. It builds strong economic, technical and social ties among these partners. Relationship marketing involves cultivating the right kind of relationship with the right stakeholder groups.

Its ultimate outcome is the building of a unique company asset called a marketing network. The two key themes of e. Many different marketing activities are employed to communicate and re deliver value. All marketing activities are co-ordinated to maximize their in complimentary effects. The design and implementation of any one marketing activity is done with all other activities in mind. Internal marketing; Holistic marketing incorporates internal marketing lo ensuring that everyone in the organization embraces appropriate l marketing philosophies and principles especially senior management.

Social responsibility marketing; Holistic marketing incorporates social w responsibility through understanding and implementing broader societal concerns for ethical, environmental, legal and social aspects of marketing activities and programs.

The effect and cause of marketing clearly extends beyond the company and the consumer to society as a whole. Social responsibility also requires that marketers carefully consider the role that they are playing and could play in terms of social welfare. That l. He should get equal value for money. Concepts of social responsibility m i. Profit responsibility co ii. Stakeholder responsibility iii. Societal responsibility e.

Profit responsibility; It holds that companies have a simple duty i. Stakeholder responsibility; This concept focuses on the obligations an l. These constituencies include customers, employees, suppliers and w distributors. The firm must build and maintain long lasting beneficial w relationships with important stakeholders. Societal responsibility; It refers to the obligations that organizations have to the preservation of the ecological environment.

General public concerns about the environment and public welfare are represented by interest and advocacy groups such as the Greenpeace movement, an international environmental organization. Green marketing; It is a concept whereby a company produces goods or services which do not pollute the environment i. Green marketing takes many forms e. Shell Oil Company which produces lead-free gasoline.

Technologically improved means of lo communication, transport, and production led to relatively reduced l. But in spite w of these changes, most industries concerned themselves with sales i.

In the middle of the 20th century onwards some suppliers started thinking of adjusting their products and prices to reflect customer requirements, hence the start of marketing orientation of business. This was further triggered by the 2nd world war, which created an increased demand for most manufactured goods. The development and evolution of marketing can be looked at from the following stages; 1 Production-orientation era; Goods were scarce during this period of the industrial revolution s s.

Therefore buyers were willing to buy virtually any goods that were produced. Manufacturers had the idea that products would sell themselves, so the major concern of business was production and not marketing. During this time the firms discovered that they could produce more m goods than they would be bought because production had been automated after the invention of many machinery and equipment.

Marketers were more involved in designing and production of goods unlike in the past nl when they were involved only after the item had been produced. External pressure such as w customer discontent, concern for the physical environment and w political- legal forces had to be factored in the marketing programs of firms.

The marketer had to be concerned with creating and delivering a better quality of life and preserve the well being of the customer and society in general. Marketing planning involves setting marketing objectives and deciding on the marketing strategies to achieve the objectives. Implementation is putting the plans into action. It involves day-to-day activities that translate the plan to work. Marketing control is essential because surprises may occur during implementation.

Control is the process of measuring and evaluating the m results of marketing strategies and taking corrective action to ensure that objectives are attained. It is aimed at answering the questions; What is happening? Why does it happen? How does it affect the firm?

Events in the environment may cause a threat or opportunity, strength or a weakness. A strength is an internal asset that the organization possesses which is essential and is m lacked by competing organizations. The environment of the business consists of two main e. Tangible assets include financial, material, machinery and w personnel resources while intangible assets include corporate image w and company reputation.

Value chain analysis It is a way of looking at a business as a chain of activities that transform inputs to outputs that customers value. The following factors come to the fore; e. Culture describes the accepted norms of a society and will determine what people buy and consume. As nl a marketer it is important that we use technology to improve the speed and efficiency of doing business.

To avoid product obsolescence and lo promote innovation, a firm must be aware of technological changes l. Innovative use of technology can lead to possibilities of a new product, product improvements or improvements w in production and marketing techniques. The legislation is aimed at protecting companies from unfair competition, to protect customers from unfair business practices and for environmental conservation.

Such actions reduce the profit potential of firms. However, others such as patent laws are designed for the benefit and protection of firms. An industry is a group of companies that offer products that satisfy similar customer needs e.

Analyzing competitive forces is aimed at the following; a Identifying business opportunities i. Competitive forces determine the profitability of an industry. Different co forces are more prominent in shaping competition in each industry. The threat is dependent on w the barriers to entry and the reaction of existing competitors.

When w barriers to entry are high, competition in the industry declines over time. The threat is greater where there is little or no product differentiation. Differentiation may be based on durability, more features, better packaging or after sales service. Bargaining power of buyers In some industries buyers can exert power to producers by forcing down prices, demanding higher quality or more after sales service.

They depend on some unique capability to achieve and sustain their low cost position e. A differentiation strategy requires that a company creates a product that is recognized as being unique, thus permitting the firm to charge a higher price or attract more customers. Differentiation can be in the form of a unique product attribute or better customer service.

The focus strategy involves targeting a particular target market and serving the narrow market than competitors who serve a broader m market. The idea is to achieve differentiation within the narrow market where the product is tailored to the unique demands of the smaller co market. A strength is a unique resource distinctive competence that gives a firm a competitive advantage in the market. In cell 2 the firm has identified key strengths but faces an unfavourable m environment.

In this situation, strategy would be to redeploy the strong resources to build long term opportunities. The strategy would be to focus on eliminating the weaknesses so as to pursue the opportunities. Quantitative techniques are based on the analysis of data by use of statistical techniques. Qualitative forecasting techniques 1. Delphi method This is a method of developing a consensus of expert opinion.

A panel of experts is chosen to study a particular problem. Panel members do not meet as a group. They are asked to give an opinion about certain future events. Based on this information, the panel members rethink their earlier responses and make a second forecast. The same procedure continues until a consensus is reached.

Executive judgment This is a method of forecasting based on the intuition of one or more executives. The approach may work well where the forecaster has past market experience. A major demerit is that the forecaster may be too pessimistic or optimistic. Customer surveys In this case customers are asked what types and quantities of products m they intend to buy during a specified period of time.

But this may only be possible where the business has few customers who may be able to co make accurate estimates of future product requirements. The e. Sales force forecasting survey ef Sales people are asked to estimate the anticipated sales in their in territories for a specified period. Test marketing w It is useful for new products for which no previous sales figures exist. It becomes necessary to estimate likely demand for the product by testing it on a sample of the market.

It involves the limited launch of a product in a closely defined geographical area e. The test market results can then be generalised for the whole market. Quantitative techniques 1. Time series analysis This technique forecasts future demand based on what has happened in the past. The method assumes that historical data will form a similar pattern into the future. Regression modelling This is a forecasting technique in which an equation with one or more variables is used to predict another variable.

The one being predicted is called the dependent variable and the other variables used to predict it are the independent variables. The technique determines how changes in the independent variables affect the dependent variable. Once a relationship is established, future values for the dependent variable can be forecast based on predicted values of the independent variables.

The process is aimed at understanding basic needs of customers and delivering products that satisfy the needs. It puts a company to be m in a pro active rather than a reactive position. Approaches to planning w 1. Top down planning; this is where top management sets the goals and w plans for all the lower levels of management.

Bottom up planning; it is where organizational units prepare their own goals and plans and set them to higher management for approval. Goals-down, plans-up planning; under here top management sets corporate goals and various company units then develop plans to help the company achieve corporate goals.

The plans have to be approved by top management. Corporate level; Large corporations often have several lines of businesses. The portfolio of businesses S. Us is often coordinated with a corporate strategy consisting of a common mission and goals. A corporate mission is the purpose of existence of the firm. It sets the overall direction for the firm. The firm may also have a vision which is a long term aspiration that the firm pursues and does not have to be accomplished e.

Goals provide strategic performance targets that the entire e. Business unit level; Strategy at this level establishes how an S. Each S. While a corporate vision is w something to be pursued, a mission is something to be accomplished. A business unit goal is a performance target the business unit seeks to reach in an effort to achieve the overall original mission. Functional level strategy; It is concerned with the implementation of the corporate and business unit strategies.

It entails the formulation of marketing programs i. Situation analysis SWOT 3. Implementing marketing programs 6. The mission should guide the firm toward product markets where customer needs and competitive conditions offer attractive growth opportunities. It should also steer the firm away from industries and markets where strong competition or new technologies may pose m threats.

The analysis tries to answer two questions; where are we now? And where do we want to be in future? Situation analysis is in three forms; environmental, industry and competitor analysis. Developing or revising marketing objectives These are formulated taking into account the internal and external company situation. Objectives may be such as adding new products, product modification, expanding the market size etc.

They revolve around product design, distribution, promotion and price. Implementing marketing programs This is the process that turns marketing strategy into action. It involves day-today activities that translate the plan to work. Implementation control; It is the process of measuring the results of marketing strategies and taking corrective action to ensure that m objectives are attained.

The marketing plan co A marketing plan is a road map for the marketing activities of an e. It can be developed for each business product or brand. Executive summary in It is a brief summary of the main goals and recommendations of the plan.

Company description lo The section highlights the recent history and successes of the firm. Situation analysis w It involves analysis of the current market situation, competitors, w customers and SWOT.

Marketing objectives The section defines product and market objectives in the areas of sales, profits, market share, new products or new markets to be pursued.

Marketing strategies It describes the marketing mix actions that will be used to achieve the objectives. Each strategy is intended to utilize resources to respond to threats and opportunities to attain objectives. Action programs for implementation The section specifies the daily activities that translate the plan into action.

It specifies what will be done, assigns responsibilities, schedules the work, sets timetables and allocates resources to every activity. Financial projections The revenue and expense effects of the action programs for implementation are projected to show the expected return on investment for the plan. Evaluation and control m This section indicates how the progress of the plan will be monitored by setting performance standards, predicting problems and the corrective co action that might be taken.

It is concerned with all management tasks e. It should be carried out periodically and not only during a crisis. The auditor carries out an investigation of the marketing activities and develops a set of findings and recommendations for management.

It in consists of everything the firm can do to influence the demand for its product. They are the variables that marketing managers can control w in order to best satisfy customers in the target market w The firm attempts to generate a positive response in the target market by blending these four marketing mix variables in an optimal manner.

Product The product is the physical product or service offered to the consumer. In the case of physical products, it also refers to any services or conveniences that are part of the offering. Product decisions include aspects such as function, appearance, packaging, service, warranty, etc. Pricing includes not only the list price, but also discounts, financing, and other options such as leasing.

Place Place or placement decisions are those associated with channels of distribution that serve as the means for getting the product to the target customers. The distribution system performs transactional, logistical, and facilitating functions. Distribution decisions include market coverage, channel member m selection, logistics, and levels of service. Promotion co Promotion decisions are those related to communicating and selling to e.

Since these costs can be large in proportion to the product price, a break-even analysis should be performed when making re promotion decisions. It is useful to know the value of a customer in ef order to determine whether additional customers are worth the cost of in acquiring them. Promotion decisions involve advertising, public relations, media types, nl etc.

A product is everything that can be offered to a market for attention, acquisition, use or consumption that might satisfy a want or need. It includes physical objects, services, persons, places, organizations and ideas. It is the need satisfying offering of an enterprise. When consumers buy a product, they are actually buying satisfaction or the benefits that the product would offer.

A physical product can be viewed at five levels; 1. Core product; This is the most basic level. It addresses the question; m what is the customer really buying? It consists of the problem solving or core benefits that consumers obtain when they buy a product. Expected product; It is a set of attributes and conditions consumers ef normally expect when they purchase the product.

Augmented product; It is the part of a product which exceeds customer expectations. Potential product; It encompasses all the possible augmentations and lo transformations the product might undergo in the future.

Non-durable goods are those that are normally consumed in one or a few uses. Consumer goods are those bought by final consumers for personal consumption. Types of consumer products: They include; convenience products, shopping products, specialty products, and unsought products. Convenience products; They are those goods that the customer usually buys frequently, immediately and with a minimum of comparison and buying effort.

They are usually low priced and widely available. They are of two main types; a Staples; are those that are bought often, routinely and without much thought. The consumer will not have planned to buy and only decides to do so on sight.

Shopping goods; They are products that a customer feels are worth the time and effort to compare with other products on suitability, quality, m price etc. Specialty goods; They are those that the customer wants and makes a special purchase effort to search for them because of their unique nl characteristics or brand identification.

Customers have specific lo expectations of the product and substitutes would not be accepted e. They include life insurance. They are of two types; a. Informative promotions can help convince customers to accept these products. Regularly unsought products; they are products which may satisfy a certain need but potential customers are not motivated to satisfy it.

Personal selling is usually used to persuade customers to buy. Installations; They are such as buildings and heavy machinery used in manufacturing. They are durable products therefore they are not bought very often. They are usually expensive hence many people including top management are involved in the purchase decision and purchase negotiations may take a long time.

To achieve buyer satisfaction suppliers offer special after-sales services. Accessories; Include tools and equipment such as fax machines, computers, photocopiers etc. They cost less and are less durable than installations therefore fewer people are involved in the purchase m process and negotiations take a shorter time. Raw materials; These are unprocessed farm products e. Component parts; Are processed items that become part of a finished ef product e.

They are bought from another supplier in and their quality is paramount and the buyer tries to buy from sources that help assure good product quality.

Supplies; These are items that do not become part of a finished lo product. Product mix Product Assortment Decisions A product mix is the range of products a company offers i. A product mix may consist of several product lines. The dimensions of the product mix provide the means for defining the e. It can add new product lines thus widening its product mix breadth. It can lengthen its existing product lines by re adding new products product line stretching.

The company can remove unprofitable items from its product lines nl product line pruning or product elimination. The benefits are communicated and delivered through product w attributes which are; quality, features, and design. It w includes product durability, reliability, ease of operation and repair.

They are a competitive tool for product differentiation. A good design attracts attention. It is expressed relative to the position of competitors e. Mercedes is positioned as a luxury car, Volvo for safety. A firm can positively influence market perceptions hence the position its product through effective promotion activities. The company makes itself and its products admirable and visible or noticeable by the potential customer.

Product positioning process m a. Collecting information from a sample of customers about their e. Deliver the attributes to effectively and positively position your ef product.

A product often goes through the following five stages:- w 1. Product development: Begins when the company finds and develops a new product idea. Sales are zero and investment costs add up due to marketing research, product development, and market testing activities.

Introduction: Starts when the product is first launched on a large scale. Strategies: -Set a lower price to encourage product acceptance -Promote to create awareness. Growth stage: Features: -Sales start climbing -New competitors enter the market -New product features and versions are introduced as the market expands m -Prices remain the same or fall just slightly -Increases in the number of distribution outlets co -Promotion spending remains the same or slightly increased e.

Strategies: re -Improve product quality ef -Add new product features and models in -Entrance to new market segments -Entrance to new market distribution channels nl -Advertising shifts from building product awareness to building lo preference and conviction.

Shake-out stage: The period is marked by a drop in overall growth. During this stage, w the firm should eliminate weaker items from its product line, emphasize w on promotional pricing and strengthen its channel relationships.

Maturity stage: Features: -Lasts longer than the previous stages -There is a slow-down in sales growth -There is increased competition e.

This may be achieved through product quality improvement i. Decline stage Features: -Sales decline -Profits are low or zero -Competitors are few or non-existent m -Reduced number of product offering -Promotion and prices are further reduced co Strategies: e. Stop its manufacture or sell it. In this case the more profitable alternative would be to lo withdraw the product. The company at this stage must avoid making two types of nl errors; -Drop error: where the company dismisses an otherwise good idea.

The company should identify which group of customers e. Concept testing involves presenting the product concept to appropriate target consumers and getting their reactions. The planned price, distribution strategy and promotion budget for the first year. Estimates on future sales, costs, and profits are done to determine whether they satisfy company objectives.

The physical product must be able to e. This permits the company to assess the impact nl of marketing strategy. When timing If a company learns that its competitor is about to launch a similar product in the market, it has three options; First entry; the first firm that enters a market usually enjoys the advantages of hooking up key distributors and customers. But if the product is rushed to the market it may fail. The market may pay more attention when two companies are advertising the new product.

Late entry; the firm might delay its launch until after the competitor has entered. The competitor will have borne the cost of educating the market and its product may reveal faults that the late entrant can avoid.

If the product is seasonal, it might be delayed until the right season arrives. Where geographic strategy m The company must decide whether to launch the new product in a single locality or several regions. Company size; small companies will first enter an attractive city with a heavy promotional campaign and enter others one at a time. To whom Target- market prospects nl The company must target its initial distribution and promotion to the lo best prospect groups who would have the following characteristics; l.

Reasons that may lead to new product failures w -Top management may push through their favourite new product idea w despite poor marketing research findings. Interest: At this stage the individual is more psychologically involved by developing desire to give attention to or be concerned about a product.

Evaluation: Under here a person decides whether to proceed further or to forget about the new product. A search for more information is done m to act as a basis for evaluation. Adoption: The consumer decides to make full and regular use of the new product.

The five adopter categories are as follows: nl Innovators: Are the first group of people to buy a new product. They lo are venturesome i. They tend to be l relatively younger, and have higher incomes. They are more receptive. Early majority: These adopt new ideas before the average person. Late majority: They are sceptical and adopt an innovation only after a majority of people have tried it.

Laggards: Are tradition-bound and are suspicious of changes and adopt the innovation only when most other people are already using it. Influence of product characteristics on the rate of adoption. Categories of services re 1. Product-support services; This is where a firm offers a physical good ef e. Major Service with accompanying minor goods and services; E. Pure service; the offering consists primarily of a service e.

Characteristics of service and their marketing implications 1. Business is lost during periods of low l. The following strategies can be used to produce a better match w between supply and demand in a service business; w 1. Differential pricing may be used to shift demand from peak to off peak w periods. Complementary services can be developed during peak time to provide alternatives to waiting customer e. Part time employees can be hired to serve during peak demand.

People: The people aspect of the marketing mix requires a high degree of interpersonal skills. Physical environment: It refers to the place where the service is being prepared and delivered. The physical environment of e. The environment plays a major role in standardizing the quality perception re of the organization and service.

Process: This refers to developing processes for the delivery of service in that will give value to the customer e. Offering: What the customer expects is called the primary service w package.

To this the provider can add secondary service feature e. Faster and better delivery: Where a company can differentiate by designing a delivery system that is reliable and speedy in their on-time delivery and order completeness.

Image: Service companies can also differentiate through symbols and branding that enhance the image of the company and its services e. Internal marketing refers to employee development through effective recruitment, training, communication and motivation so that they can work as a team to provide customer satisfaction. It is designed to ensure that everybody within the organization contributes towards developing a market oriented, customer focused m culture in order to improve the level of service to customers.

Internal marketing process co 1. Determine the expectations of the internal customer and deliver e. Identify the tasks that deliver customer value and emphasize on these re tasks.

Customer value is the unique combination of benefits received by ef target buyers that include quality, price, convenience, on-time delivery in and after-sales service.

Provide training in order that employees have the appropriate skills to nl undertake the tasks. Provide appropriate human and financial resources. Establish a marketing excellence recognition program to reward. In service marketing, the employee plays a major role in attracting, re building and maintaining relationships with customers.

Product in a Exclusivity; Services lack exclusivity because of their inability to be nl patented. A patent gives the manufacturer of product exclusive rights to its manufacture for a specified no. Hence competitors can lo quickly copy service innovations. Pricing; In the service industry price plays two main roles; w a It is used to communicate the quality of service i.

Place; Services are inseparable hence intermediaries are rarely used because the distribution site and service provider are the tangible components of the service. Service firms use multiple locations for the distribution of services e. Promotion; Personal selling is the most commonly used component of the promotion mix in service marketing. The firm may also use publicity and public relations to build its corporate and brand image in supporting its personal selling efforts.

Key components in the design of a service offering 1. They include courtesy, re empathy, helpfulness etc. Delivery sequence in A service delivery process may contain several elements which should be delivered in a certain sequence e.

In the retention phase, loyalty is assessed through tools like customer satisfaction surveys. The strategic stage calls for integration of customer needs, aspirations and expectations in new product development, modification and distribution changes. Customer service An effective strategy used in differentiating an offer from that of competitors is to excel in delivering quality service to the customer.

When positive perceptions are not confirmed by the actual performance of the firm, a gap occurs. This gap is called the service quality gap. Customer perceptions of the firm and its offer are shaped by; a Word of mouth publicity i.

Service quality parameters SERVQUAL re According to Zeithml et al customers assess the service of a firm using ef the following; in 1 Tangibles; the appearance of physical facilities, equipment, personnel and communications material. Strong brands can charge a higher price and customers are willing to pay a premium price for them.

It may consist of the following; a Brand name; the part of a brand that can be vocalised. It is a promise to the customer. Omo, Blueband. Types of brands 1. Individual product branding; Under here every product has its own brand name without any obvious connection to other brands — Unilever, Procter and Gamble. Co-branding; This is where one firm partners with another to create a brand e.

Citibank MasterCard. Generic branding; This is offering a brandless product. They are seen as low price alternatives that are affordable to buyers. Nike watches. Multi brand strategy; This refers to offering two or more brand names in the same product category e. Such traits include; warmth and youthfulness. Unilever toothpaste product line consists of Close-up, Pepsodent and Aim, which are product items.

Honda automobiles, land mowers, generators, motorcycles etc. Celtel ef to Zain. Brand equity Definition; it is the positive effect that knowing the brand name has on customer response to a product. It results in customers showing a preference for one product over another when the two are basically identical. It is the net worth of the brand to the brand owner. Packaging It consists of the activities of producing and designing the container or m wrapper of a product. The package of a product can be looked at from three levels; co e.

Secondary; the carton or box that protects the primary package and w which is often discarded. Shipping package; the larger container carrying several pieces of the secondary package which is necessary for storage and long-distance transportation. Labelling It consists of printed information that appears on the container or wrapper of a product. Attractive graphics on the package help promote the product at the point of sale.

Labelling also assists in describing product ingredients and usage. It is the determinant that focuses on maximizing revenue in order to meet profit objectives of the company. Definition; Price is the amount of money charged for a product or the sum of values consumers exchange for the benefits of having or using a product.

Pricing objectives m 1. Survival: the company sets price levels that cover variable costs and co some fixed costs so as to stay in business. Current profit maximization: where the firm chooses the price that e. The company believes that a higher sales nl volume will lead to lower unit costs Economies of scale and higher long —run profit. Market skimming: where a firm sets a high price for a new product to skim the market i. Product quality leadership: a company may achieve this objective by providing the best quality in the market at a premium price as a basis of product differentiation.

Factors affecting price 1. Internal factors a Marketing objectives: price should be set with regard to market targeting and positioning strategies e.

It wants to charge a price that covers all e. External factors re a Market demand: while costs set the floor lower limit of prices, ef consumer value perceptions market and demand set the higher limit. Variable costs increase with sales volume and are added to fixed costs to form total costs. The total revenue curve starts at zero and rises with each unit sold. It must make a volume of sales above the B. The firm might charge the same, more or less than the major competitor.

Pricing policies 1. One price policy: means offering the same price to all customers who purchase the products under the same conditions. Perceived value pricing Potential customers place different weights on different elements of perceived value e. For price buyers, a company should offer stripped down products and reduced services. For loyal buyers companies must invest in building closer customer relationships. Value pricing e. Promotional pricing re It may take the following forms; ef a Loss leader pricing: supermarkets often drop the price of well known in brands to induce more people to come in and in the process buy other products.

The seller promises to refund the buyer a w certain percentage of the purchase price on proof of purchase. Psychological pricing This approach considers the psychology of prices where the price is used to say something about the product.

The assumption is that customers perceive high quality in a highly priced product. The price may also be set at a figure that suggests the price falls within a certain price range, e. Geographical pricing The company may charge different prices for the same product in different parts of the country for the purpose of covering extra transporting costs.

It is a form of discriminatory pricing Discount policies Discounts are reductions from the list price given by a seller to buyers. A list is the price final consumers are normally asked to pay for a product. To get the sale price, customers give up nl the convenience of buying when they want to buy and instead buy lo when the seller wants to sell. Trade-in allowances: are price reductions given for returning an old item when buying a new one e.

Product line pricing Sellers use different points for various products in a line. Customers will associate low medium and high quality suits with the three price points. Optional feature pricing The seller offers optional products, features and services along with the m main product. The motor vehicle buyer can order light dimmers, free delivery and an extended warranty or forego them for a lower price. Captive product pricing; Some products require the use of additional or e.

Sellers of razors, pens and cameras often price them low and set higher prices for razor blades, pen refills and films re respectively. By-product pricing in This is where the production of a product results in a by-product. If the by-product has value to a customer group it should be priced at its nl value. The income earned on the by-product will make it easier for the lo company to charge a lower price on its main product.

Skimming price policy w This may be used to maximize profits in the market introduction stage. Penetration pricing This is where a seller tries to sell to the whole market at one low price. The policy is more attractive when selling larger quantities. It results in lower costs because of economies of scale and when the firm expects strong competition soon after introduction.

The plan is to raise prices as soon as the introductory offer is over. This strategy may also be used to attract customers to a brand later in the life cycle. Communication is sharing of meaning through the transmission of information. The components of the communication process are illustrated below; Source message medium of receiver or Transmission m audience co e.

Feedback Source: Is a person, group or organization that has an intended re meaning which it attempts to share with an audience. This can be summarized as DRIP i. There are four major promotional tools i. Others are; direct market and sponsorship.

Advertising It is any form of non-personal communication about a firm and its products that is transmitted through the mass media television, radio, newspaper, magazines, outdoor displays, the internet etc.

It is usually done in the ef early stages of the product life-cycle to inform potential customers in about the new product. Its purpose is. This is the total amount of money that a marketer allocates for advertising over a period of time. Factors to consider are such as; The re geographic size of the market, Type of product, Business sales volume ef relative to competitors, and Distribution of buyers within the market. The aim is to reach the largest possible number of people in the advertising target and achieve the appropriate message reach and frequency for the target.

Reach: The percentage of consumers in the advertising target actually exposed to a particular ad in a stated time period. Frequency: The number of times target consumers are exposed to a particular advertisement. The plan must decide which media to use e. Changes in demand of the product may also be measured. Personal Selling e. It is the process of using personal communication in an exchange re situation to inform customers and persuade them to purchase products.

It is a process by which; ef -one identifies the people, who have a need. While face to face with prospects, sales people can get more attention than an advertisement. Tasks of sales people a Prospecting; gathering information to gain sales and prospective clients. The sales nl person is only interested in achieving high sales volume and does not lo care what happens when the deal is through i.

They locate new customers, open new accounts and seek new opportunities. Sales people help in market information gathering. Press conferences; meetings called by the firm to announce major news events or to respond to a crisis. Events; like trade shows, exhibitions, anniversaries etc. Corporate social responsibility activities; i.

The visual identity may be in the nl form of company logo, stationery, brochures, signs, business cards etc. It is often a short-term incentive to w encourage purchase of the product. Consumer sales promotions: These are often aimed at the final consumers. They include the following; Coupons: certificates entitling the bearer to a price reduction of a product. The coupons are distributed through the print media, direct mail and attached to other products. Demonstrations: are occasions at which a manufacturer shows how a product works in order to encourage trial use and purchase of the product.

They are normally employed by supermarkets and are co mechanisms in which regular customers who remain loyal to a e. Nakumatt smartcard re Free samples: are give-away used to stimulate trial of a new product or ef to induce brand switching. Consumer sweepstakes: consumers submit their names for inclusion in a draw for prizes.

Trade sales promotions; These are aimed at the resellers e. They include; Buying allowance; a temporary price reduction to resellers for purchasing specified quantities of a product. Free merchandise: free items offered to resellers who purchase a stated quantity of the same or different products. Sales contests; are designed to motivate distributors and resellers by m recognizing and rewarding outstanding achievements.

Advantages of sales promotion co 1. Low unit cost for selling e. Sales promotion is always the outcome of large scale production. Large scale production itself is meant for low cost. Sales promotion assures of re a low cost selling. Effective sales support in Basically, sales promotion policies supplement the efforts of personal and impersonal salesmanship advertising. Increased speed of product acceptance l Most of the sales promotion devices contests, coupons can be used.

If dispersed advertising would be used. Socio-economic characteristics: Age, income, level of education. Pull policy; In which a business promotes directly to consumers in order nl to create a strong consumer demand for its products.

It ensures that customers w get their products at the right place and at the right time. Distribution is w about places i.

Physical distribution refers to the marketing tasks concerned with efficient physical movement of goods and services from the producer and includes the tasks of transportation and storage.

A distribution channel consists of a group of individuals or organizations that assist in getting the product to the right place and time- just when and where the customer wants it. Wholesalers: they buy goods from the manufacturer, store them and sell to the retailers. Retailers: are the final stopping points for the product prior to its sale to the end user.

Distributors: these are the intermediaries who stock products for manufacturers and sell them. In most cases they are appointed by the manufacturer. Dealers: they are those who specialize in selling one particular brand e. In most cases they sell to end user. Their e. Franchise: this is a business relationship where the franchisee re holds a contract to market and supply a product or service that has ef been very strictly designed and developed by the franchiser. The in franchisee must adhere to the strict terms and conditions on store design, layout and contents sold within the retail outlet e.

Merchandisers: these are responsible for store displays, relating l to their products in various retail outlets. They manage displays,. Zero-level channel; this is where the producer sells directly to the consumer i. One level channel; this is where there is only one intermediary i.

Producer retailer consumer 3. Two level channel; it involves two intermediaries i. Three level channel; it involves three intermediaries i. Producer agent or distributor wholesaler retailer consumer Most consumer products go through the longer channels. Functions of middlemen The basic role of middlemen is to make the product available and accessible to customers in a more cost effective way than could be achieved by the manufacturer alone.

They do this by performing some or all of the following functions; 1. Breaking bulk; they buy goods from the manufacturer in large quantities and sell them in smaller quantities that end users wish to m buy.

Delivery; they buy products from manufacturers and deliver them to many small customers with small vans, thus increasing accessibility. After-sales service; they offer operational instructions, warranties and ef installation as in the case of electronic and industrial goods.

Price setting; they may have the authority to set prices. Promotion; they undertake the activities of displaying, demonstrating nl and developing persuasive communications about a product. Matching; i. Information gathering; they gather and distribute marketing w information about the marketing environment needed for marketing w planning.

Extending credit; industrial distributors often sell on credit to their customers thus removing a significant cash flow burden from the manufacturer. Risk taking; they assume the risks of damage through fire, accidents, fall in prices etc. The reasons why middlemen are used relate to lower costs and higher sales. Lower costs; Fewer lines of contact; they reduce the lines of contact between producers and end users i.

Producers m Middleman co e. Distributors often relief the manufacturer of such tasks. Green plants : the best flowers and gifts Sport Finance-3rd Edition. By Mary T. Newport 1st Edition. Sport finance 3rd edition, isbn: , off coupons we found with our CheapestTextbooks. Gil fried - abebooks Author: gil fried. Edit Your Search. Sport Finance. Gil Fried.