4 Ps of marketing

Marketing decision variables are those variables under the firm's control that can affect the level of demand for the firm's products. They are distinguished from environmental and competitive action variables that are not totally and directly under the firm's control. The four marketing decision variables are: Price variables Allowances and deals

Distribution and retailer mark-ups Discount structure

Product variables Quality

Models and sizes Packaging Brands Service

Promotion variables Advertising

Sales promotion Personal selling Publicity

Place variables Channels of distribution

Outlet location Sales territories Warehousing system

Marketing > Segmentation Market Segmentation Market segmentation is the identification of portions of the market that are different from one another. Segmentation allows the firm to better satisfy the needs of its potential customers. The Need for Market Segmentation The marketing concept calls for understanding customers and satisfying their needs better than the competition. But different customers have different needs, and it rarely is possible to satisfy all customers by treating them alike. Mass marketing refers to treatment of the market as a homogenous group and offering the same marketing mix to all customers. Mass marketing allows economies of scale to be realized through mass production, mass distribution, and mass communication. The drawback of mass marketing is that customer needs and preferences differ and the same offering is unlikely to be viewed as optimal by all customers. If firms ignored the differing customer needs, another firm likely would enter the market with a product that serves a specific group, and the incumbant firms would lose those customers. Target marketing on the other hand recognizes the diversity of customers and does not try to please all of them with the same offering. The first step in target marketing is to identify different market segments and their needs. Requirements of Market Segments

In addition to having different needs, for segments to be practical they should be evaluated against the following criteria: Identifiable: the differentiating attributes of the segments must be measurable so that they can be identified. Accessible: the segments must be reachable through communication and distribution channels. Substantial: the segments should be sufficiently large to justify the resources required to target them. Unique needs: to justify separate offerings, the segments must respond differently to the different marketing mixes. Durable: the segments should be relatively stable to minimize the cost of frequent changes. A good market segmentation will result in segment members that are internally homogenous and externally heterogeneous; that is, as similar as possible within the segment, and as different as possible between segments. Bases for Segmentation in Consumer Markets Consumer markets can be segmented on the following customer characteristics. Geographic Demographic Psychographic Behavioralistic Geographic Segmentation The following are some examples of geographic variables often used in segmentation. Region: by continent, country, state, or even neighborhood Size of metropolitan area: segmented according to size of population Population density: often classified as urban, suburban, or rural Climate: according to weather patterns common to certain geographic regions Demographic Segmentation Some demographic segmentation variables include: Age Gender Family size Family lifecycle Generation: baby-boomers, Generation X, etc. Income Occupation Education Ethnicity Nationality Religion Social class Many of these variables have standard categories for their values. For example, family lifecycle often is expressed as bachelor, married with no children (DINKS: Double Income, No Kids), full-nest, empty-nest, or solitary survivor. Some of these categories have several stages, for example, full-nest I, II, or III depending on the age of the children. Psychographic Segmentation Psychographic segmentation groups customers according to their lifestyle. Activities, interests, and opinions (AIO) surveys are one tool for measuring lifestyle. Some psychographic variables include: Activities

Interests Opinions Attitudes Values Behavioralistic Segmentation Behavioral segmentation is based on actual customer behavior toward products. Some behavioralistic variables include: Benefits sought Usage rate Brand loyalty User status: potential, first-time, regular, etc. Readiness to buy Occasions: holidays and events that stimulate purchases Behavioral segmentation has the advantage of using variables that are closely related to the product itself. It is a fairly direct starting point for market segmentation. Bases for Segmentation in Industrial Markets In contrast to consumers, industrial customers tend to be fewer in number and purchase larger quantities. They evaluate offerings in more detail, and the decision process usually involves more than one person. These characteristics apply to organizations such as manufacturers and service providers, as well as resellers, governments, and institutions. Many of the consumer market segmentation variables can be applied to industrial markets. Industrial markets might be segmented on characteristics such as: Location Company type Behavioral characteristics Location In industrial markets, customer location may be important in some cases. Shipping costs may be a purchase factor for vendor selection for products having a high bulk to value ratio, so distance from the vendor may be critical. In some industries firms tend to cluster together geographically and therefore may have similar needs within a region. Company Type Business customers can be classified according to type as follows: Company size Industry Decision making unit Purchase Criteria Behavioral Characteristics In industrial markets, patterns of purchase behavior can be a basis for segmentation. Such behavioral characteristics may include: Usage rate Buying status: potential, first-time, regular, etc. Purchase procedure: sealed bids, negotiations, etc. The strategic marketing plan Clarence Henderson, Henderson Consulting International Manila, Philippines - September 2000 Marketing practitioners often find themselves so preoccupied with the hard work of running marketing programs, supervising staff and sales force, and attending to the day-to-day grind

that they lose sight of the Big Picture. However, it is essential every once in a while to step back, gain a little perspective, and engage in some serious strategizing. The broad scope of strategic planing encompasses: All the products/services your company offers All the markets you serve Both environmental and internal variables Production, research, finance, and other organizational elements needed for success Strategic planning looks beyond the immediate circumstances, in the process clarifying where you want to be in the future. This strategic perspective can be contrasted to the tactical level (which looks at performance of specific products or markets over a shorter time frame) and operational planning (which focuses on the nitty gritty of getting the job done). Following is a somewhat oversimplified but hopefully useful overview of the strategic planning process. Some Basics Start with a thorough analysis and clear understanding of the strategy and objectives of your company. What is the corporate development strategy? This broad understanding is essential for at least three reasons. First, marketing expertise is required to implement abstract corporate strategy. Second, key marketing decisions such as which market niches to address, product distribution channels, and direct marketing tactics flow directly from business strategy. And third, top management philosophy and mindset should provide the foundation for developing the strategic marketing plan. Begin by identifying your strategic business unit (SBU). This might be an entire company, a division, a product line, or a single product, as long as that unit is a separate entity for planning purposes (i.e., has its own management, access to resources, competitors, positioning strategy, and customers). An SBU must be large enough to be a meaningful unit for strategy formulation and evaluation, yet small enough for effective planning and marketing management. There are four key elements to strategic planning at the SBU level: Identification of the business Situation Analysis Selection of strategies Establishment of controls What business are you in? In "Marketing Myopia", his classic 1975 article published in Harvard Business Review, Theodore Levitt pointed out that many companies have gotten themselves in deep trouble because they failed to understand just exactly what business they were in. Railroads went under in the states in part because they stubbornly kept thinking of themselves as being in the railroad business, when in fact they were in the transportation business. Don't make that mistake yourself! Focus, analyze, reflect, and come to a consensus about what business you are really and truly in. After clarifying the nature of your business, move to a Situation Analysis, which might also be referred to as a marketing audit. You should conduct such reviews regularly to capture a "snapshot" of your current status. Your situation, of course, includes both external and internal components. External Review A periodic review of the business environment is essential.. Typically you would want to cover the following areas. Economic-demographic variables. Economic forces are always important; for example, an expanding economy has fundamentally different implications than one that is in retrenchment. You must also understand demographic factors, and especially

demographic shifts. Technological variables, which now change at warp speed. New processes, new products, and new markets for previously unimagined products are the norm. Indeed, the demand for new products/service can force you into obsolescence if you don't keep up. You simply can't afford to ignore this dimension. Political-legal variables, including regulatory and tax issues, reporting requirements, and the myriad other issues that impact your business. The relative impact depends on your sector, as government policies that are good for one sector can do significant harm to another sector. Sociocultural variables, the subtle market and psychological forces that alter demand patterns and market dynamics. Internal review. Then turn to a comprehensive review of internal processes, including information systems, product lines, competition, distribution channels, market planning, sales compensation, marketing costs, and expense budgets. This "snapshot" gives you an objective platform from which to dive into the meat of the strategic planning process. Marketing Strategy Analysis 1. Customer analysis answers important questions about each specific product/service market. Among the factors you should assess are: Estimated annual purchases Projected annual growth rate Size of market (# of customers/organizations/purchasing units) Demographics/socioeconomics of customers Geographic concentration or dispersion Customer buying motivations Information they base purchase decisions on Purchasing practices 2. Key competitor analysis for each major competitor: Estimated business strength Market share and market trend Financial strengths and weaknesses Profitability Quality of management Technology position Marketing strategy (target market strategy, program/product positioning, product line strategy and distribution, pricing strategy, promotions strategy) 3. SWOT analysis: What are your own distinctive competencies? Whether in a group context or sitting alone at your desk, work your way through your strengths, weaknesses, opportunities, and threats. Enumerate them, reflect on them, analyze them, and evaluate how they interact with one another. Maximize your strengths, minimize your weaknesses, take advantage of your opportunities, and counteract your threats. What direction does your analysis lead you in? The output of a solid SWOT analysis will help you formulate your marketing objectives. Pulling the Plan Together As Hannibal Smith, the leader of the old A-Team television show used to say, "I love it when a plan comes together." The figure below provides one possible format you can use to pull together your own Marketing Plan. Add as many rows as you need for various products/services and marketing/promotional activities. By completing the information in the table, you address the key issues of product, populations, price, place, production, and

promotion. Marketing Objectives: The first step in pulling your strategic marketing plan together is to use the output of your Situation Analysis and SWOT work to establish specific marketing objectives that are SMART: specific, measurable, achievable, relevant, and time-bounded. Enumerate those objectives in the first section of the worksheet. From there you move smoothly through the table, completing each section in turn. Marketing mix analysis for each product/service: Focus on each product/service category. For each one specify the target population, pricing, places for product/service delivery, any changes you'll need to make, and key features and benefits to promote. Log this information on the worksheet. Marketing activity analysis for each product/service: Focus on each marketing activity. Identify the responsible party, the timeframe, and the budget for each activity and record that information on the worksheet. Promotional activity analysis for each product/service: Repeat the process, but this time focus on specific promotions. Identify specific techniques, marketing/promotional messages, and actions you are trying to get your target markets to take. Make this planning process a team effort. Ask everyone involved in implementing the plan for suggestions. Strategic market planning must be a living, breathing process, so expect to periodically reevaluate your status. Keep all members of your marketing and management team informed about progress in implementation, and revise the plan as new opportunities and ideas emerge. You'll soon discover that the Big Picture approach can help you better manage your marketing activities and increase sales.
Packaging is the science, art, and technology of enclosing or protecting products for distribution, storage, sale, and use. Packaging also refers to the process of design, evaluation, and production of packages. Packaging can be described as a coordinated system of preparing goods for transport, warehousing, logistics, sale, and end use. Packaging contains, protects, preserves, transports, informs, and sells.

Primary packaging is the material that first envelops the product and holds it. This usually is the smallest unit of distribution or use and is the package which is in direct contact with the contents.

Secondary packaging is outside the primary packaging, perhaps used to group primary packages together. Tertiary packaging is used for bulk handling, warehouse storage and transport shipping. The most common form is a palletized unit load that packs tightly into containers.