210 likes | 253 Views
Entrepreneurship and Small Business Management. Chapter 7 Developing the Right Marketing Mix and Plan. Ch. 7 Performance Objectives. Combine the four Ps—product, price, place, and promotion—into a marketing mix. Choose the attributes of your product or service.
E N D
Entrepreneurship and Small Business Management Chapter 7 Developing the Right Marketing Mix and Plan
Ch. 7 Performance Objectives • Combine the four Ps—product, price, place, and promotion—into a marketing mix. • Choose the attributes of your product or service. • Determine the mix of promotion to use for your business. • Find a way to add the fifth P, philanthropy, to your business.
Ch. 7 Performance Objectives (continued) • Understand the importance of a marketing plan. • Identify the critical components of a marketing plan. • Use breakeven analysis to evaluate your marketing plan.
Marketing Mix: The Four Ps • Product—What are you selling? • Price—What does the price “say” about your product? • Place—What is the best location for your business? • Promotion—How will you advertise and publicize your product?
Create Your Product Concept • Products are defined by: • Physical attributes • Performance characteristics • Pricing • Branding • Delivery • Key to successful branding: focus on the product’s primary benefit
Establish Your Brand • Choose an easy-to-remember name that describes your business. • Design a logo that symbolizes your business. • Develop a good reputation. • Create a brand “personality” and communicate it to your target market.
Build Your Brand’s Reputation • Provide a high-quality product/service. • Maintain high ethical standards. • Define the product/service clearly. • Treat employees well. • Make ads positive and informative. • Associate the company with a charity. • Be involved in the community.
Price Considerations • Simply undercutting competitors’ prices will not necessarily win you the largest market share. • Consider the psychology of pricing: consumers tend to infer things about a product/service based on its price.
Place • The type of business affects the location that works best. • Who are your customers? • Where do they shop? • Goal: Find a location affordable for you, yet also convenient for customers.
Promotion • Promotion—use of advertising and publicity to get your marketing message to your customers. • Advertising—purchased promotion (billboards, TV ads, magazine ads, etc.) • Publicity—free mention of a company, person, or product/service in the media
Advertising specialties Banner ads Billboards Blogs Broadcast media Brochures Business cards Catalogs Coupons Direct mail Directories Flyers Networking Newsletters Print media Promotional clothing Public speaking Samples/demos Special events Sponsorships Telemarketing Toll-free numbers Web sites Promotion Methods
Philanthropy: The Fifth P • Philanthropy—a concern for human and social welfare, expressed by giving money through charities/foundations • Foundation—not-for-profit organization that manages funds donated to help people and social causes • Philanthropy creates goodwill—favorable reputation, name recognition, and positive customer relations
Cause-Related Marketing • Inspired by a commitment to a social, environmental, or political cause • Simple way to work philanthropy into your business • Examples: • Donate fixed % of revenue to charity • Donate products/services • Encourage employees to volunteer
Roles of a Marketing Plan • Convince skeptical investors that your plan has merit. • Use and disclose market studies. • Identify the target market. • Evaluate the competition. • Demonstrate the pricing strategy. • Detail the advertising plan.
Can You Afford Your Marketing Plan? • Marketing is part of your business’s fixed costs and should not be budgeted as a percent of sales. • Calculate breakeven units to determine if the business can cover marketing costs with the number of units you expect to sell. • Breakeven units = Fixed cost (per month or per year) divided by gross profit per unit