Marketing and Distribution

1. Marketing and Distribution Chapter 11

2. Learning objective • I can identify what marketing is and the important role it plays in selling products

3. Development of Marketing • Marketing • History of Marketing by what the focus has been on • Production • Sales • Advertising • Consumer Sovereignty • Consumer making choices for market production • Today – How will product add to

4. Learning objective • I can identify what marketing is and the important role it plays in selling products

5. Learning objective • I can identify and give examples of the 4 types of utility

6. 4 Types of Utility • Form Utility • Example??? • Place Utility • Example??? • Time Utility • Example??? • Ownership Utility • Example???

7. Learning objective • I can identify and give examples of the 4 types of utility

8. Learning Objective • I can identify the purpose of Market Research and describe how it is done

9. Market Research • Process using research methods to find out what consumer • Research used to determine how to promote product • What is target Audience? • What is most effective way to reach audience? • When is Market Research done? • Beginning of Product Development • What do consumers want in a product • After development • Taste testing or product sampling • Purpose • Is there a market for the good or service • Who is our intended audience? • Do we need to change product before we offer for sale? • Immediately After release • Is advertising attracting intended buyers? • Is product working for consumers as expected? • What can we do to increase or maintain current sales?

10. Product development • Step 1 • Conduct a survey • Who are users of product • Age, gender, income, education, location (urban, rural, suburban) • Questionnaire, Individual interviews, focus group discussions, online • Step 2 • Test Market the product • Select small area to release the product • Track sales at various prices • If doing poorly • Alter (very costly) or Abandon the product • If doing well • Offer nationally • Very few make it to this level • Why do producers continue to make new??? • Opportunity of high profit product

11. Learning objective • I can identify the purpose of Market Research and describe how it is done

12. Learning Objective • I understand the purpose of a Marketing Strategy and can describe the 4 P’s of Marketing

13. “Four Ps” of Marketing • Companies will develop a marketing strategy • Details how to successfully sell product • Includes 4 Ps of Marketing • Product • Price • Place • Promotion

14. Product • Market research determines • What to sell • Marketing Department also determines • Services to offer with product • Warranties • How to Package product • Size, design, color, coupons (repeat buyers), rebate offers • EX. New and Improved, Economy Size • What identification to use • Attract consumers to look at, buy, and remember a product • Uses a logo, colors, a song, etc

15. Price • Ultimately decided by Supply and Demand • BUT, Producer must considercosts of • Production • Advertising • Selling • Distributing • How much profit desired • When first introduced Penetration Pricing often used • Low introduction price to lure consumers away from similar product • Another tactic is to offer coupons • If consumer satisfied, will buy again without coupon • Prices also determined by Price Leadership • One firm lowers, all others lower • One firm raises, all other raise

16. Place • Where should product be sold • Mail, telephone, department stores, specialty shops, supermarkets, discount stores, door-to-door, or on Internet • Could be combination of many • Other considerations??? • Location within a store • Cereal/Candy at children’s eye level • More expensive items at Adult eye level/Nearest door • Mail Order Catalogs/Specialty Shops • Geographic Location • Rural vs. Urban

17. Promotion • Use of advertising to inform consumers new or improved product is available • Seeks to convince to purchase new item • Type of Promotion depends on 3 factors • Product • Type of consumer company wants to attract • Amount company plans to spend • Teen Product – teen magazine or Social Media site • Credit Card Company – Usually Direct mail advertising • Other Promotions: • Free Samples, Cents-off coupons, gifts, rebates

18. Learning objective • I understand the purpose of a Marketing Strategy and can describe the 4 P’s of Marketing

19. Learning objective • I know and understand a product’s life cycle

20. Product Life Cycle • Introduction • Growth • Maturity • Decline • Important to understand because marketing different at each stage • Introduction – product must be explained more thoroughly – Prices lower to entice buyers • Growth – Prices much higher to maximize profits • Maturity – Slightly lower prices - • Decline • Redesign Packaging • Find new uses for product • Refocus advertising

21. Learning objective • I know and understand a product’s life cycle