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Fundamental concepts and principles of marketing process

This unit aims to provide learners with an introduction to the fundamental concepts and principles that underpin the marketing process. In addition, it examines the role and practice of marketing within the changing business environment. This broad- based unit will provide all learners with a concise and contemporary overview of marketing, and give them the knowledge and skills to underpin further study in the specialist field of marketing.

Tasks

Task 1

Quote Chartered Institute of Marketing ( UK) and American Marketing Institute’s definition of marketing precisely, and according your opinion, explain how a marketing organization could implement or practice this. Is it possible to live up to these definitions?

Select a marketing organization which you think could be sighted as the ideal organization which has given a ‘life’ to these definitions.

If marketing has ‘identified customer needs….’ As its definition s say, has all customer needs are fulfilled in this 21st century. (This is open for discussions. Line up your arguments with global and local examples)

Outcome covered: (1) Investigate the concept and process of marketing (Assignment criteria: 1 & 2)

Task 2

What do you understand as ‘Micro environment’ of organizations? In relation to the organization you have selected, identify and explain macro and micro environmental factors which influence marketing decisions

Market Segmentation, Targeting and Positioning are components include in a good marketing strategy. Answer the following in relation to the organization which you have selected.

Propose segmentation criteria to be used for two products in different markets

Outline the factors which influence the choice of targeting strategy

Explain how buyer behavior affects marketing activities in two different buying situations

Outcome covered: (2) Explore the concepts of segmentation, targeting and positioning (Assessment criteria: 1, 2, 3 & 4)

Task 3

How Marketing mix variables (7Ps) are used in the organization which you have selected. Explain with examples.

Outcome covered: (3) Identify and analyze the individual elements of the extended marketing mix (Assessment Criteria: 1, 2, 3, 4, & 5)

Task 4

Answer the following in relation to the organization which you have selected

Recommend marketing mixes for two different segments in consumer markets

Explain differences of marketing tactics used when marketing products and services to organizations rather than to consumers

Outcome covered: (4) Apply the extended marketing mix to different marketing segments and contexts (Assessment Criteria: 1 & 2)

Grading Criteria

Pass: To obtain a pass;

The student must complete all the assignment tasks correctly

Merit: To obtain a merit;

Use rang of methods and techniques to collect analyze and process information / data.

Apply and analyze detailed knowledge and skills, using relevant theories and techniques.

Coherently present and communicate work using technical language accurately.

Distinction: To obtain a Distinction

Check validity when collecting, analyzing and processing complex information/ data.

Evaluate and synthesize theories and techniques to generate and justify valid conclusions.

Show an individual approach in presenting and communicating work coherently using technical language fluently.

Task 1

Quote Chartered Institute of Marketing (UK) and American Marketing Institute’s definition of marketing precisely, and according your opinion, explain how a marketing organization could implement or practice this. Is it possible to live up to these definitions?

Select a marketing organization which you think could be sighted as the ideal organization which has given a ‘life’ to these definitions.

UNILEVER

Introduction to Unilever

160 million times a day, someone somewhere chooses a Unilever product. From feeding your family to keeping your home clean and fresh, our brands are part of everyday life.

Life partner

With 400 brands spanning 14 categories of home, personal care and foods products, no other company touches so many people's lives in so many different ways.

Our brand portfolio has made us leaders in every field in which we work. It ranges from much-loved world favourites including Lipton, Knorr, Dove and Omo, to trusted local brands such as Blue Band and Suave. 

From comforting soups to warm a winter's day, to sensuous soaps that make you feel fabulous, our products help people get more out of life. 

We're constantly enhancing our brands to deliver more intense, rewarding product experiences. We invest nearly €1 billion every year in cutting-edge research and development, and have five laboratories around the world that explore new thinking and techniques to help develop our products. 

Continuous development

Consumer research plays a vital role in our brands' development. We're constantly developing new products and developing tried and tested brands to meet changing tastes, lifestyles and expectations. And our strong roots in local markets also mean we can respond to consumers at a local level. 

By helping improve people's diets and daily lives, we can help them keep healthier for longer, look good and give their children the best start in life. 

We also believe that the very business of conducting business in a responsible way has a positive social impact. We create and share wealth, invest in local economies and develop people's skills – both inside our organisation and in the communities around us. 

Today Unilever employs 174 000 people in 100 countries worldwide, and supports the jobs of many thousands of distributors, contractors and suppliers. 

Health & personal care

First launched in France in 1983, our leading male grooming brand, Axe, now gives guys the edge in the mating game in over 60 countries

Our oral care brands Mentadent, Peposodent and Signal have teamed up with the world's largest dental federation, the FDI, which represents over 750 000 dentists around the world

Lux became the first mass-marketed soap when it launched in 1924. Today it achieves annual global sales of over €1 billion

Domestos is a best-selling brand in nine of the 35 countries in which it's sold

Hindustan Unilever in India has launched a hand-wash product, Surf Excel Quick Wash, with a low foaming formulation, reducing the amount of water needed for rinsing by up to two buckets per wash

Recent breakthroughs at Rexona include Rexona Crystal, a deodorant that eliminates unsightly white deposits on dark garments

Our Small & Mighty concentrated liquid fits into a smaller bottle, requiring half the packaging, water and lorries to transport it, making it kinder on the environment. 

Foods

Knorr is our biggest food brand with a strong presence in over 80 countries and a product range including soups, sauces, bouillons, noodles and complete meals

We're the world's largest ice cream manufacturer, thanks to the success of our Heartbrand which includes Magnum, Cornetto, Carte d'Or and Solero, and Ben & Jerry's and Breyers in the US

Lipton's tea-based drinks include the international Lipton Iced Tea range, the Lipton range in North America and Lipton Yellow Label, the world's favourite tea brand

Becel/Flora pro.activ products have been recognised as the most significant advancement in the dietary management of cholesterol in 40 years

In the mid-1990s we led the industry with our programme to eliminate almost all trans fat from our margarine

Unilever Sri Lanka at a glance

Unilever Sri Lanka was incorporated in 1938 with brands such as Sunlight, Lux and Pears Rose.

Our company at a glance

Today it is home to 26 strong brands that are leaders in all the categories that they operate in. With the local consumer being at the heart of our business we have products ideally suited to the Sri Lankan consumer. 

Type of business

Fast moving consumer goods company with local manufacturing facilities, reporting to the regional business groups for innovation and business results. 

Operations

Home Care, Personal Care and Foods

Product categories

Household care, fabric cleaning, skin cleansing, skin care, oral care, hair care, tea, spreads, personal grooming

Our brands

Astra, Axe, Bru, Ceylonta, Clear, Comfort, Flora, Dove, Fair & Lovely, Knorr, Laojee, Lipton, Lifebuoy, Lux, Marmite, Pears Baby, Ponds, Rexona, Rin,Signal, Sunsilk, Sunlight, Surf Excel, Vaseline, Vim and Wonderlight 

Employees

Unilever Sri Lanka provides employment to 1100 people directly and many thousands more indirectly through its dedicated suppliers, distributors and service providers. 

Our vision

Our mission is to add Vitality to life. We meet everyday needs for nutrition; hygiene and personal care with brands that help people look good, feel good and get more out of life.

Our mission

Vitality is at the heart of everything we do. It's in our brands, our people and our approach to business.

Enthused with Vitality

Vitality is at the heart of everything we do. It's in our brands, our people and our values.

Vitality means different things to different people. Some see it as energy, others view it more broadly as a healthy state of body and mind – of feeling alive.

Whatever their personal definition, millions of people around the world use our products daily to add Vitality to their lives - whether that's through feeling great because they've got shiny hair and a brilliant smile, keeping their homes fresh and clean, or by enjoying a great cup of tea, satisfying meal or healthy snack.

Ever since the 19th Century when William Hesketh Lever stated that the company's mission was "to make cleanliness commonplace; to lessen work for women; to foster health and contribute to personal attractiveness, that life may be more enjoyable and rewarding for the people who use our products," Vitality has been at the heart of our business.

Vitality defines what we stand for: our values, what makes us different, and how we contribute to society. It's the common thread that links our brands and it’s central to the unique way we operate around the world.

Health & nutrition

Our Vitality mission commits us to growing our business by addressing health and nutrition issues. We focus on priorities including children and family nutrition, cardiovascular health and weight management.

Inside & out

Our culture also embodies Vitality. Adding Vitality of life requires the highest standards of behavior towards everyone we work with, the communities we touch and the environments on which we have an impact.

The growing demand for more Vitality in life provides us with a huge opportunity for growth. The way we work and the products we develop are shaped by consumer trends, along with the need to help raise health and hygiene standards in both the developing and industrialized regions of the world.

Purpose & principles

Our corporate purpose states that to succeed requires "the highest standards of corporate behavior towards everyone we work with, the communities we touch, and the environment on which we have an impact."

Always working with integrity

Conducting our operations with integrity and with respect for the many people, organizations and environments our business touches has always been at the heart of our corporate responsibility.

Positive impact 

We aim to make a positive impact in many ways: through our brands, our commercial operations and relationships, through voluntary contributions, and through the various other ways in which we engage with society. 

Continuous commitment

We're also committed to continuously improving the way we manage our environmental impacts and are working towards our longer-term goal of developing a sustainable business.

Setting out our aspirations 

Our corporate purpose sets out our aspirations in running our business. It's underpinned by our code of business Principles which describes the operational standards that everyone at Unilever follows, wherever they are in the world. The code also supports our approach to governance and corporate responsibility.

Working with others

We want to work with suppliers who have values similar to our own and work to the same standards we do. Our Business partner code, aligned to our own Code of business principles, comprises ten principles covering business integrity and responsibilities relating to employees, consumers and the environment.

Reference 01: http://www.unilever.com.lk/aboutus/

Definition of Marketing

Marketing is the management process responsible for identifying, anticipating and satisfying customer requirements profitably

Reference 02: http://www.cim.co.uk/resources/understandingmarket/definitionmkting.aspx

American Marketing Association

Marketing is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large

Reference 03: http://www.marketingpower.com/aboutama/pages/definitionofmarketing.aspx

If marketing has ‘identified customer needs….’ As its definitions say, has all customer needs are fulfilled in this 21st century. (This is open for discussions. Line up your arguments with global and local examples)

Task 2

What do you understand as ‘Micro environment’ of organizations? In relation to the organization you have selected, identify and explain macro and micro environmental factors which influence marketing decisions

Microenvironment

Elements close to a company that impact the company's ability to serve its customers. There are six components of the microenvironment: the company's internal environment, composed of the management personnel and including the finance, purchasing, manufacturing, research and development, and marketing departments; the company's suppliers, who provide the goods and services necessary for the production of the company's products; the marketing intermediaries, composed of all the individuals or companies who help in the promotion, selling, and distribution of the company's products; the customers, consisting of the five types of markets in which the company may sell its products (consumer, industrial, reseller, government, and international markets); the company's competitors; and the company's various publics, which can be any individual or group that can affect the company's ability to achieve its objectives, such as citizen action groups, the media, or the government.

Reference 05: http://www.allbusiness.com/glossaries/microenvironment/4962927-1.html

To analysis Micro and Macro environment I am taking Unilever’s Dove Shower cream

Dove

In a world of hype and stereotypes, the Dove brand provides a refreshing alternative for women who recognise that beauty isn't simply about how you look.

Making a genuine difference

Dove is committed to widening the definition of beauty for women because we believe real beauty comes in all ages, shapes and sizes. To help you enjoy your own brand of beauty, Dove provides an extensive range of cleansing and personal care products that make a genuine difference to the condition and feel of your skin and hair.

Did you know

Over 50% women say their body disgusts them (Dove Internal Study 2002), and that the body fat of models and actresses portrayed in the media is at least 10% less than that of a healthy woman

Over 7.2 million people use Dove products every single week             

How it all started

Unilever acquired a French patent for a radically new product; a personal cleansing bar that was not a soap. Rather, this new bar contained a pH-neutral cleanser and a moisturizing component. Dove Bar was born and launched in the US in 1957

It promised women that it wouldn’t dry their face the way that soap did. Women tried it. And it didn’t. Thus began a very trusting relationship between Dove and its users.

In 1995, Dove took its first significant step outside of the cleansing bar category in the US with the launch of Moisturizing Body Wash

Other categories soon followed: 

1 Deodorants: 1997 (Europe)

2 Body Lotion: 1999 (Europe)

3 Facial Foam: 1999 (Japan) 

4 Hair: 2000 (Taiwan)     

With a simple, relevant promise, maintained and with a perceivably superior product and a magically delightful product experience; Dove Today is in 80 countries making Women beautiful every day. 

Reference 06: http://www.unilever.com.lk/brands/personalcarebrands/dove.aspx

Porter’s five forces

Intensity of Rivalry

Number of rivals increased

Buyer demand is growing

Power of Buyers

Many options for buying shower cream

Substitutes are available ( soap)

Power of suppliers

Option for purchasing general suppliers is high ( super markets, grocery stores)

Many suppliers

Threat of substitute products

Shower cream have many substitute products. Eg: Shower gel, soap bar

Thus, the threat is very high

Threat of new entrants

Relatively high start up cost

Intensity of Rivalry

Threat of new entrants high

Increased buyer spending

Steady growth in industry

Macro environment

Major external and uncontrollable factors that influence an organization's decision making, and affect its performance and strategies. These factors include the economic, demographics, legal, political, and social conditions, technological changes, and natural forces.

Reference 07: http://www.businessdictionary.com/definition/macro-environment.html

Macro environment

PESTEL analysis of the macro-environment

There are many factors in the macro-environment that will effect the decisions of the managers of any organization. Tax changes, new laws, trade barriers, demographic change and government policy changes are all examples of macro change. To help analyse these factors managers can categories them using the PESTEL model. This classification distinguishes between:

Political factors. These refer to government policy such as the degree of intervention in the economy. What goods and services does a government want to provide? To what extent does it believe in subsidising firms? What are its priorities in terms of business support? Political decisions can impact on many vital areas for business such as the education of the workforce, the health of the nation and the quality of the infrastructure of the economy such as the road and rail system.

Economic factors. These include interest rates, taxation changes, economic growth, inflation and exchange rates. As you will see throughout the "Foundations of Economics" book economic change can have a major impact on a firm's behavior. For example:

               - higher interest rates may deter investment because it costs more to borrow

               - a strong currency may make exporting more difficult because it may raise the price in terms of foreign currency

               - inflation may provoke higher wage demands from employees and raise costs

               - higher national income growth may boost demand for a firm's products

Social factors. Changes in social trends can impact on the demand for a firm's products and the availability and willingness of individuals to work. In the UK, for example, the population has been ageing. This has increased the costs for firms who are committed to pension payments for their employees because their staff are living longer. It also means some firms such as Asda have started to recruit older employees to tap into this growing labor pool. The ageing population also has impact on demand: for example, demand for sheltered accommodation and medicines has increased whereas demand for toys is falling.

Technological factors: new technologies create new products and new processes. MP3 players, computer games, online gambling and high definition TVs are all new markets created by technological advances. Online shopping, bar coding and computer aided design are all improvements to the way we do business as a result of better technology. Technology can reduce costs, improve quality and lead to innovation. These developments can benefit consumers as well as the organizations providing the products.

Environmental factors: environmental factors include the weather and climate change. Changes in temperature can impact on many industries including farming, tourism and insurance. With major climate changes occurring due to global warming and with greater environmental awareness this external factor is becoming a significant issue for firms to consider. The growing desire to protect the environment is having an impact on many industries such as the travel and transportation industries (for example, more taxes being placed on air travel and the success of hybrid cars) and the general move towards more environmentally friendly products and processes is affecting demand patterns and creating business opportunities.

Legal factors: these are related to the legal environment in which firms operate. In recent years in the UK there have been many significant legal changes that have affected firms' behavior. The introduction of age discrimination and disability discrimination legislation, an increase in the minimum wage and greater requirements for firms to recycle are examples of relatively recent laws that affect an organization’s actions. Legal changes can affect a firm's costs (e.g. if new systems and procedures have to be developed) and demand (e.g. if the law affects the likelihood of customers buying the good or using the service).

Different categories of law include:

consumer laws; these are designed to protect customers against unfair practices such as misleading descriptions of the product

competition laws; these are aimed at protecting small firms against bullying by larger firms and ensuring customers are not exploited by firms with monopoly power

Employment laws; these cover areas such as redundancy, dismissal, working hours and minimum wages. They aim to protect employees against the abuse of power by managers

Health and safety legislation; these laws are aimed at ensuring the workplace is as safe as is reasonably practical. They cover issues such as training, reporting accidents and the appropriate provision of safety equipment

Market Segmentation, Targeting and Positioning are components include in a good marketing strategy. Answer the following in relation to the organization which you have selected.

Propose segmentation criteria to be used for two products in different markets

Outline the factors which influence the choice of targeting strategy

Explain how buyer behavior affects marketing activities in two different buying situations

Market segmentation

The division of a market in to different homogeneous groups of consumer is known as market segmentation.

Market segment should be:

Measurable

Accessible by communication and distribution channels

Different in its response to a marketing mix

Durable

Substantial enough to be profitable

Consumer Market segmentation

Geographic segmentation is based on regional variables such as region, climate, population density, and population growth rate

Demographic segmentation is based on variables such as age, gender, ethnicity, education, income, occupation and family status

Psychographic segmentation is based on variables such as values, attitudes and lifestyles

Behavioral segmentation is based on variables such as usage rate and patterns, price sensitivity, brand loyal, and benefit sought

MARKET TARGETING

INTRODUCTION: - There was a time when finding the best customers was like

Throwing darts in the dark. Target marketing changed all that...Today's savvy marketers know that finding their best prospects and customers hinges on well thought out targeted marketing strategies.

Defining a target market requires market segmentation, the process of pulling apart the entire market as a whole and separating it into manageable, disparate units based on demographics.

Target market is a business term meaning the market segment to which a particular good or service is marketed. It is mainly defined by age, gender, geography, socio-economic grouping, or any other combination of demographics. It is generally studied and mapped by an organization through lists and reports containing demographic information that may have an effect on the marketing of key products or services.

Target Marketing involves breaking a market into segments and then concentrating your marketing efforts on one or a few key segments. Target marketing can be the key to a small business’s success. The beauty of target marketing is that it makes the promotion, pricing and distribution of your products and/or services easier and more cost-effective. Target marketing provides a focus to all of your marketing activities.

Market targeting simply means choosing one’s target market. It needs to be clarified at the onset that marketing targeting is not synonymous with market segmentation. Segmentation is actually the prelude to target market selection. One has to carry out several tasks beside segmentation before choosing the target market.

Through segmentation, a firm divides the market into many segments. But all these segments need not form its target market. Target market signifies only those segments that it wants to adopt as its market. A selection is thus involved in it.

In choosing target market, a firm basically carries out an evaluation of the various segments and selects those segments that are most appropriate to it. As we know that the segments must be relevant, accessible, sizable and profitable. The evaluation of the different segments has to be actually based on these criteria and only on the basis of such an evaluation should the target segments be selected.

POSITIONING

INTRODUCTION: - Positioning is a concept in marketing which was first Popularized by Al Ries and Jack Trout

Al Ries and Jack Trout in their bestseller book “Positioning - a Positioning - a

battle for your mind". According to them ‘Positioning is what you do to mind of

the prospect’. They iterate that any brand is valued by the perception it carries in

the prospect or customer's mind. Each brand has thus to be 'Positioned' in a particular class or segment. Example: Mercedes is positioned for luxury segment, Volvo is positioned for safety.

The position of a product is the sum of those attributes normally ascribed to it by the consumers – its standing, its quality, the type of people who use it, its strengths, its weaknesses, any other unusual or memorable characteristics it may possess, its price and the value it represents.

Although there are different definitions of Positioning, probably the most

common is: "A product's position is how potential buyers see the product", and is expressed relative to the position of competitors. Positioning is a platform for the

brand. It facilitates the brand to get through to the mind of the target consumer. The position of the brand has thus to be carefully maintained and managed.

Example: when Malboro cut down its prices, its sales dropped immediately, as it began being associated with the generic segment. Watches like Rolex are positioned as luxury segment watches, thus they being one of the most expensive have become a symbol for accomplishment in life. If Rolex reduces its prices, it loses its perceived image and hence is in danger of losing its customers.

Reference 07: http://www.scribd.com/doc/6356725/MARKET-SEGMENTATION-TARGETING-POSITIONING-By-Subha-Rudra

The segmenting criteria to be used for two products in different markets are:

In this section I am taking two different products. They are

Axe Deo

Signal

Axe Deo is a deodorant specially made for men. It was first launched in France in 1983. In 2006 it was introduced to Sri Lanka.

Demographic segmentation is basically market segmentation executed by taking various demographic factors, such as age, gender, social class etc., into consideration. This helps the organization to divide the market into several groups, each having a common variable, and target each of these groups to enhance the performance of the organization. The word demographic is derived from the word demography, meaning study of population. This market segmentation strategy aims at understanding the prospective market, and taking necessary steps to ensure that the consumer needs of a targeted group is fulfilled.

Demographic Segmentation Variables

Segmentation variables are basically factors which help the organization to determine the target group. In demographic segmentation, variables mainly consist of demographic factors such as age, ethnicity, occupation etc. Below we have given a list of demographic segmentation variables which are commonly used to divide the market into smaller segments.

Age

Gender

Family size

Family life cycle

Income

Occupation

Education

Ethnicity

Nationality

Religion

Social standards

Therefore Axe Deo can be segmented in consumer markets under demographic segmentation. Because Axe deodorant is specially made for men.

These are the Demographic Segmentation Advantages

One of the most popular method of market segmentation; demographic segmentation has some benefits which make it the first choice in the marketing strategies of various organizations. These advantages of demographic segmentation are

The organization can easily categorize the wants of the consumers on the basis of demographic factors such as age, gender etc.

Demographic segmentation variables are much easier to obtain and measure compared to the variables of other segmentation strategies.

By using signal tooth paste as a product, Unilever Company segments their product in Industrial market.

Industrial customers tend to be fewer in number and purchases large quantities. They evaluate offerings in more detail, and the decision process usually involves more than one person. These characteristic apply to organizations such as manufacturers, service providers, as well as resellers, governments and institutions.

Characteristics of industrial segmentation are:

Location

Company type

Behavioral characteristics

Under health, hygiene and beauty Unilever market their signal toothpaste product as an industrial segmentation.

The factors which influence the choice of targeting strategy

Market maturity

Diversity of buyer’s needs and preference

Strength of the completion

The volume of the sales required for profitability

How buyer behavior affects marketing activities in two different buying situations

Buying Behavior is the decision processes and acts of people involved in buying and using products.

Need to understand:

Why consumers make the purchases that they make?

What factors influence consumer purchases?

The changing factors in our society.

Consumer Buying Behavior refers to the buying behavior of the ultimate consumer. A firm needs to analyze buying behavior for:

Buyer’s reactions to a firms marketing strategy has a great impact on the firms success.

The marketing concept stresses that a firm should create a Marketing Mix (MM) that satisfies (gives utility to) customers, therefore need to analyze the what, where, when and how consumers buy.

Marketers can better predict how consumers will respond to marketing strategies.

Six Stages to the Consumer Buying Decision Process (For complex decisions). Actual purchasing is only one stage of the process. Not all decision processes lead to a purchase. All consumer decisions do not always include all 6 stages, determined by the degree of complexity...discussed next.

The 6 stages are:

Problem Recognition (awareness of need)--difference between the desired state and the actual condition. Deficit in assortment of products. Hunger--Food. Hunger stimulates your need to eat.

Can be stimulated by the marketer through product information--did not know you were deficient? I.E., see a commercial for a new pair of shoes, stimulates your recognition that you need a new pair of shoes.

Information search--

Internal search, memory.

External search if you need more information. Friends and relatives (word of mouth). Marketer dominated sources; comparison shopping; public sources etc.

A successful information search leaves a buyer with possible alternatives, the evoked set.

Hungry, want to go out and eat, evoked set is

Chinese food

Indian food

burger king

Klondike kates etc

Evaluation of Alternatives--need to establish criteria for evaluation, features the buyer wants or does not want. Rank/weight alternatives or resume search. May decide that you want to eat something spicy, Indian gets highest rank etc.

If not satisfied with your choice then returns to the search phase. Can you think of another restaurant? Look in the yellow pages etc. Information from different sources may be treated differently. Marketers try to influence by "framing" alternatives.

Purchase decision--Choose buying alternative, includes product, package, store, method of purchase etc.

Purchase--May differ from decision, time lapse between 4 & 5, product availability.

Post-Purchase Evaluation--outcome: Satisfaction or Dissatisfaction. Cognitive Dissonance, have you made the right decision. This can be reduced by warranties, after sales communication etc.

After eating an Indian meal, may think that really you wanted a Chinese meal instead.

Reference 08: http://www.udel.edu/alex/chapt6.html

A consumer purchasing decision might affect because of following factors:

Personal

Psychological

Social

Personal

Unique to a particular person. Demographic Factors. Sex, Race, Age etc.

Who in the family is responsible for the decision making?

Young people purchase things for different reasons than older people.

Psychological factors

Psychological factors include:

Motives--

A motive is an internal energizing force that orients a person's activities toward satisfying a need or achieving a goal.

Actions are effected by a set of motives, not just one. If marketers can identify motives then they can better develop a marketing mix.

MASLOW hierarchy of needs!!

Physiological

Safety

Love and Belonging

Esteem

Self Actualization

Need to determine what level of the hierarchy the consumers are at to determine what motivates their purchases.

Social Factors

Consumer wants, learning, motives etc. are influenced by opinion leaders, person's family, reference groups, social class and culture.

Buyer’s situation1:

Farm shop selling pork where it is situated in a Muslim areas.

Buyer’s situation 2:

Building a church where Buddhist people are situated

Task 3

How Marketing mix variables (7Ps) are used in the organization which you have selected. Explain with examples.

The Marketing Mix model can be used by marketers as a tool to assist in defining the

marketing strategy. Marketing managers use this method to attempt to generate the

Optimal response in the target market by blending 4 (or 5, or 7) variables in an

optimal way. It is important to understand that the Marketing Mix principles are

controllable variables. The Marketing Mix can be adjusted on a frequent basis to meet

the changing needs of the target group and the other dynamics of the marketing

environment.

The service marketing mix comprises off the 7’p’s. These include:

Product: A tangible object or an intangible service that is mass produced or manufactured on a large scale with a specific volume of units. Intangible products

are often service based like the tourism industry & the hotel industry or codes-based products like cell phone load and credits

Price: The price is the amount a customer pays for the product. It is determined by a number of factors including market share, competition, material costs, product identity and the customer's perceived value of the product.

Place: Place represents the location where a product can be purchased. It is often referred to as the distribution channel. It can include any physical store as well as virtual stores on the Internet.

Promotion: Promotion represents all of the communications that a marketer may use in the marketplace. Promotion has four distinct elements -advertising, public relations, word of mouth and point of sale

People: all people who directly or indirectly influence the perceived value of the product or service, including knowledge workers, employees, management and consumers.

Process: Procedures, mechanisms and flow of activities which lead to an exchange of value.

Physical evidence: The direct sensory experience of a product or service that allows a customer to measure whether he or she has received value. Examples might include the way a customer is treated by a staff member, or the length of time a customer has to wait, or a cover letter from an insurance company, or the environment in which a product or service is delivered.

Marketing mix variables used in Unilever

Products

Unilever has variety of products ranging from food brands, home care brands, personal care brands, Cooking and eating, health, hygiene and beauty and nutrition.

Food brands

Astra

Brooke Bond Ceylonta

Flora

Knorr

Laojee

Lipton

Marmite

Home care brands

Comfort

Rin

Sunlight

Surf Excel

Vim

Personal care Brands

Axe

Dove

Fair & lovely

Lifebouy

Lux

Pears

Ponds

Rexona

Signal

Sunsilk

Vesline

Cooking and eating

How to make the perfect brew

Stir-fry tips from Knorr

Chicken Satay

Smart sandwich makers

Spiced Basmathi Rice

Promotion

Brief Introduction:

Promotion is a key element of marketing program and is concerned with effectively and efficiently communicating the decisions of marketing strategy, to favorably influence target customers’ perceptions to facilitate exchange between the marketer and the customer that may satisfy the objective of both customer and the company.

A company’s promotional efforts are the only controllable means to create awareness among publics about itself, the products and services it offers, their features and influence their attitudes favorably.

Unilever Marketing communication Mix

Unilever will spend Rs 100 crore in this financial year on advertising and promotion on their entire range of consumer products.

The major elements of promotion mix include advertising, personal selling, sales promotion, direct marketing, and publicity.

Advertising

Advertising is any paid form of non-personal mass communication through various media to present and promote product, services and ideas etc. by an identified sponsor.

So far Unilever has advertised its products through many different ways and Medias.

Through TV we have seen different advertisements of its products by targeting those favorable television programs, like sports, series.

Public Relation and Publicity

Public relations is a broad set of communication activities employed to create and maintain favorable relationship with employees, shareholders, suppliers, media, educators, potential investors, financial institutions, government agencies and officials and society in general.

Place/ Distribution

Decisions with respect to distribution channel focus on making the product available in adequate quantities at places where customers are normally expected to shop for them to satisfy their needs. Depending on the nature of the product, marketing management decides to put into place an exclusive, selective or intensive network of distribution, while selecting the appropriate dealers or wholesalers.

Price

Pricing decisions are almost always made in consultation with marketing management. Price is the only marketing mix variable that can be altered quickly. Price variables such as dealer price, retail price, discounts, allowances, credit terms etc. influence the development of marketing strategy, as price is a major factor that influences the assessment of value obtained by customers.

Customers directly relate price to quality, particularly in case of products that are ego intensive of technology based. Unilever being a company which emphasizes product quality, it tends to sell its products with price range from moderately-high to high-prices, depending on the use and the targeted customers.

Discussion on the current marketing mix

In my opinion the current marketing mix which Unilever has is satisfactory to customer needs. In providing a wide range of products and services with high quality, Unilever has by far influenced most of its customer’s perception favorably towards its products. From time the company was created till now, the quality of the products offers is improving each year. Even though the prices imposed by Unilever seems to be fair with consideration of the quality of the products and services offered , The only problem is that, Unilever has priced its products too expensively for a middle or lower class customer to afford to buy those products. Apart from that Unilever has targeted its market mainly to urban customers as are the only customers who can afford such expensive products.

Task 4

Answer the following in relation to the organization which you have selected

Recommend marketing mixes for two different segments in consumer markets

Consumer Market

Consumer markets are the markets for products and services bought by individuals for their own or family use. Goods bought in consumer markets can be categorized in several ways.

Axe deo is categorized in consumer market under demographic gender segmentation. Its because Axe deodorant is specially made for men. And its used above 15 years.

Rin is categorized in consumer market under geographical segmentation.

Seven Ps in the view point of Marketer and the customer

Marketer Customer

Product - Customer Value

Price - Cost

Place - Convenience

Promotion - Communication

People - Consideration

Process - Co-ordination

Physical evidence - Confirmation

Explain differences of marketing tactics used when marketing products and services to organizations rather than to consumers

Marketing strategies and tactics are very important to any business any field. Strategies are long term plans, over all campaigns to achieve a certain strategic goal. Tactics on the other hand are all about the short term, they are tools you use to achieve short term goals. They are part of your overall marketing strategy.

There are four dynamic marketing tactics used in the organization. They are:

Focus on best prospects

Take some time to analyze current customers to determine what key traits they share - and why those traits make them ideal. Then revise sales message to appeal specifically to them. This will increase both the number of new sales get and the profitability of each new customer.

Pile on the Benefits

Customers usually buy something to save time or to save money. Offer them an opportunity to do both and will boost sales. But offer them multiple opportunities to do both and will cause sales to soar dramatically.

Make Buying Easy

Make it easy for potential customers to buy from Unilever and more will buy. Look for ways that can make buying process easier - and faster.

Follow Up - Again and Again

Selling is not a one step process. Most people do not buy something the first time the see or hear about it. Can salvage many of these potential customers with an effective follow up system

Plan your marketing tactics

Once you have decided what your marketing objectives are, and your strategy for meeting them, you need to plan how you will make the strategy a reality.

Many businesses find it helpful to think in terms of the four Ps:

Product - what your product offers that your customers value, and whether/how you should change your product to meet customer needs.

Pricing - for example, you might aim simply to match the competition, or charge a premium price for a quality product and service. You might have to choose either to make relatively few high margin sales, or sell more but with lower unit profits. Remember that some customers may seek a low price to meet their budgets, while others may view a low price as an indication of quality levels.

Place - how and where you sell. This may include using different distribution channels. For example, you might sell over the internet or sell through retailers.

Promotion - how you reach your customers and potential customers. For example, you might use advertising, PR, direct mail and personal selling.

People - for example, you need to ensure that your employees have the right training.

Processes - the right processes will ensure that you offer a consistent service that suits your customers.

Physical evidence - the appearance of your employees and premises can affect how customers see your business. Even the quality of paperwork, such as invoices, makes a difference.

References

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