Marketing Mix Essay Research Paper Assignments 1

Marketing Mix Essay, Research Paper

Assignments 1 Marketing mix Scott Straughan

28/01/00

Analyse the contribution a correct marketing mix can make to the successful marketing of a product or service.

For the purpose of this essay the words analyse shall mean to break down the marketing mix into its individual components. Successful marketing shall mean good sales of a product .The word product can mean a product or a service.

The correct marketing mix of a product can be the difference between success and failure, it is therefore important to get the right mix. The marketing mix was first used by Neil Borden in 1964. Marketing mix refers to a set of marketing variables, a firm has to get the right mix of these variables to produce the response it wants from a target market. A marketing mix includes everything a firm can do to influence the sales of its product, these can be sort into four groups which we call the 4p s.

The product (means product or service) in order to sell must have a good image or brand name, a new product will sell better if it already has brand recognition. Branding gives a product an identity the customer can become familiar with, this may be a name, logo or a colour scheme, or it may be special packaging. A product must meet a customers needs, provide a function and have extra benefits. Take for example Kellogg s nutragrain, its meets a need for a on the move breakfast and it has the extra benefit of being healthy for you. Kellogg s also marketed this product on the strength of its brand name. Companies always have to carry out market research to find out the acceptability of a product. Product concept says that consumers will buy the products that offer the best quality, performance and features and that a company devote most resources to making continuous improvement Some companies may offer several lines of product this is known as the product mix, take Ford for example they have small cars to meet the needs of the driver on a budget, up to larger company car drivers. Each targets a different market, Ford have designed a range to meet everybody s needs. The product mix defines the companies marketing strategy, a company can increase its business in four ways :-

1. Add new product lines widening its product mix

2. Lengthen existing product lines

3. Add more product versions of each product

4. Pursue more product line consistency, or less, depending on whether it wants to have strong reputation in a single field or in several fields

The price of a product should reflect its cost to make, companies will often give special offers on new products to boost sales and get brand recognition. These offers may include credit terms, discounts or larger amounts (buy one get one free), this is known as penetration pricing and although it gives a lower profit margin can lead to a bigger market share, penetration is used when direct competition is high. Setting international prices can cause problems, most companies nearly always sell their products for more abroad, and it must add the cost of transportation, tariffs and wholesaler mark up. If demand for a product is high prices are usually raised, if demand is low prices are dropped to encourage sales. Another pricing strategy is market skimming, prices are set high at first and then lower them over time as you start to keep up with demand, or when competitors start to move in. Mark-up pricing is the pricing of a product based on cost, it costs x amount to produce the mark-up may be 50% higher, the mark-up price represents the profit margin. Commodity products use a going rate pricing strategy, for example a petrol station would not get away with charging much higher prices than the garage next door. Some companies carry out market research first to find out what customers will pay then design a product on that budget.

The place, this is the path to the buyer. The length of distribution channels can affect price and specifications may need to be changed to comply with different countries, car manufacturers have to make right hand drive cars for England. It is sometimes more cost effective to manufacture the product where it is sold, the Japanese had this problem, they had the longest distribution channels and decided to open factories in England. A company can draw up a channel map taking into account all the middlemen agents, shops, wholesalers etc. There is also the question of control, when AES launched the worlds first word processor, it signed up the Lanier company to handle U.S. sales, and Lanier started selling the AES product under its own name. When Lanier switched suppliers because of competition. AES had no control over the U.S. market, to increase its market share it had to start from the beginning in a market it created. If it is too expensive or risky to launch a new product in an existing market, it makes sense to take the Lanier route, your partner absorbs the up front sales expenses leaving you to concentrate on product development. Freeport s help third world countries encourage investment and now represent 9% of world trade, it is difficult to compete with Freeport s and they provide exemption from taxes, duties, minimum wage controls and even health and safety legislation.

The promotion of a product involves advertising, some companies adopt the same advertising strategies as the home c