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A product refers to a tangible or intangible item that is offered for sale or use and that is capable of satisfying a customer’s needs or wants. It could be a physical good such as a car or a smartphone or it could be a service such as insurance or a haircut.
(i) Consumer products: These are products that are purchased for personal use or consumption by individuals. Consumer products can be further classified into four categories:
– Convenience products: These are everyday products that are low-cost and frequently purchased with minimal effort. Examples include snacks toiletries and impulse-buy items.
– Shopping products: These are products that consumers spend more time and effort researching and comparing before purchasing. Examples include clothing electronics and furniture.
– Specialty products: These are unique or high-end products that have specific characteristics and are purchased with a specific purpose. Examples include luxury goods designer brands and customized products.
– Unsought products: These are products that consumers are not actively seeking out or aware of and often require marketing efforts to create demand. Examples include life insurance funeral services and some healthcare products.
(ii) Industrial products: These are products that are used in the production of other goods or services rather than being directly consumed by end-users. Industrial products can be further classified into two categories:
– Material and parts: These are raw materials components or sub-assemblies that are used in the manufacturing process. Examples include steel chemicals and electronic components.
– Capital items: These are long-lasting and expensive products that are used to run a business or facilitate production. Examples include machinery vehicles and buildings.
(i) Lack of market demand or poor market understanding: It is important for companies to thoroughly research and understand the customer needs preferences and current market trends before launching a new product. Failure to accurately identify and assess market demand can result in a product that does not meet customer expectations or solve a real problem leading to low sales and eventual failure.
(ii) Inadequate product differentiation or competitive positioning: With intense competition in the market it is crucial for a new product to offer unique features or benefits that set it apart from existing alternatives. If a new product does not have a clear and compelling value proposition it may struggle to attract customers and face difficulty in gaining market share. Additionally poor positioning relative to competitors can also lead to the failure of a new product.
(i) Mobilization of workforce: Before marketing their products firms need to mobilize their workforce. This involves the process of gathering and organizing a skilled and efficient team to carry out various tasks related to marketing. This includes hiring employees assigning roles and responsibilities providing training and development and ensuring that the workforce has the necessary resources and support to perform their tasks effectively.
(ii) Utilization of feedback: Feedback plays a crucial role in the marketing process. Firms need to gather feedback from customers stakeholders and other sources to understand their preferences needs and suggestions. This feedback is then analyzed and used to improve products services and marketing strategies. Utilizing feedback helps firms to stay responsive to customer demands and preferences and to make necessary adjustments to their marketing efforts.
(iii) Production of quality goods and services: Producing quality goods and services is vital for the success of any marketing campaign. Before marketing their products firms need to ensure that they have an efficient production process in place that delivers high-quality products or services. This involves setting quality standards implementing quality control measures and continuously monitoring and improving the production process to meet customer expectations.
(iv) Managing distribution network: An effective distribution network is essential for successful marketing. Firms need to establish a robust distribution network that ensures their products reach the target customers in a timely and efficient manner. This involves developing partnerships with distributors wholesalers retailers and other intermediaries managing inventory levels and coordinating logistics to ensure smooth product flow from production to consumption.
(v) Advertisement and promotion: Advertisement and promotion are crucial activities in marketing. Firms need to develop creative and compelling advertising and promotional campaigns to raise awareness about their products and persuade potential customers to make a purchase. This includes activities such as designing advertisements selecting appropriate media channels conducting market research identifying target audience and allocating budgets for advertising and promotion. Effective advertisement and promotion help firms to build brand recognition generate interest in their products and ultimately drive sales.
(i)Global reach: Internet marketing allows businesses to reach a global audience, regardless of their geographic location. This opens up immense opportunities to target customers from different countries and expand the customer base.
(ii)Cost-effective: Internet marketing is generally more affordable compared to traditional marketing methods such as television or print advertising. It allows businesses to target specific audiences and measure the return on investment (ROI) accurately, minimizing unnecessary expenses.
(iii)Higher customer engagement: Internet marketing provides various channels to engage with customers, such as social media, email marketing, and blog posts. These channels offer businesses an opportunity to connect with their target audience on a more personal level, fostering trust and loyalty.
(iv)Targeted advertising: Internet marketing enables businesses to target specific demographics, interests, and behaviors of their potential customers. Through tools like Google AdWords or social media advertising platforms, businesses can narrow down their reach and concentrate efforts on those who are most likely to be interested in their products or services.
(v)Measurable results: Internet marketing offers various analytics and tracking tools that allow businesses to measure the success of their marketing campaigns accurately. This can include tracking website traffic, conversion rates, customer engagement, and many other metrics. These insights help businesses make data-driven decisions and optimize their marketing strategies for better results.
sales promotion is a marketing activity that is designed to increase sales, encourage customer loyalty, or generate brand awareness. It usually involves offering a discount or some other type of incentive for customers to buy your product or engage with your brand.
(i) Increase sales: One of the primary objectives of sales promotion is to boost sales volume. By offering incentives, discounts, or limited-time promotions, companies aim to encourage customers to make immediate purchases and increase their overall sales revenue.
(ii) Create brand awareness: Sales promotion activities are often used to create awareness and generate interest in a brand or a specific product. By offering promotions, such as free samples or giveaways, companies can attract new customers and generate buzz around their brand.
(iii) Encourage trial purchases: Sales promotions can be used to motivate customers to try a new product or service. By offering trial incentives, such as free trials, money-back guarantees, or introductory offers, companies can encourage customers to take the first step and make a purchase.
(iv) Enhance brand loyalty: Sales promotion can help reinforce brand loyalty by rewarding existing customers for their repeat purchases. Loyalty programs, point systems, or exclusive offers targeted at loyal customers can help maintain a customer base and foster long-term relationships.
(v) Clear inventory or seasonal products: Sales promotions can be used to clear excess inventory or promote seasonal products. Discounts, special offers, or bundling can encourage customers to purchase these products, ensuring they don’t become deadstock and contributing to overall sales revenue.
(vi) Stimulate impulse buys: Sales promotion tactics, such as limited-time offers, flash sales, or attractive displays, can create a sense of urgency or desire for immediate purchase. By stimulating impulse buys, companies can increase their sales and capitalize on impulsive consumer behavior.
Consumer market is a market when individuals purchase products or services for their own personal use, as opposed to buying it to sell themselves.
(i)Understand customer needs and preferences: Marketing research helps firms gain a better understanding of their target customers, their needs, preferences, and behaviours. By conducting surveys, focus groups, or analyzing market data, companies can gather information about consumer demographics, buying habits, motivations, and opinions. This knowledge helps firms tailor their products, pricing, distribution, and promotion strategies to better meet customer expectations.
(ii) Assess market opportunities: Marketing research allows firms to identify and evaluate market opportunities. It helps companies analyze market trends, competition, and customer demands to identify gaps or unmet needs. By conducting market segmentation analysis, firms can identify different customer segments with varying needs and develop unique marketing approaches for each segment.
(iii)Evaluate marketing initiatives: Marketing research helps firms assess the effectiveness of their marketing initiatives and campaigns. By conducting surveys, conducting brand recall studies, or analyzing sales and customer data, companies can measure the impact of their marketing efforts. This allows firms to understand what marketing strategies are working and what needs improvement.
(iv)Monitor and respond to market changes: Marketing research enables firms to monitor changes and trends in the market environment. By tracking customer preferences, competitor activities, technological advancements, or regulatory changes, firms can adapt and respond proactively. This allows them to stay ahead of market shifts, identify emerging opportunities or threats, and develop strategies to maintain their competitive edge.
(i)Strategic direction: Marketing planning helps businesses establish a clear strategic direction. By defining the company’s goals, objectives, and target market, businesses can align their marketing efforts with their overall business strategy. It ensures that marketing activities are focused and cohesive.
(ii)Market orientation: Effective marketing planning allows businesses to adopt a market-oriented approach. It involves conducting market research, analyzing customer needs and preferences, and understanding market trends and dynamics. By being customer-focused and market-driven, businesses can develop marketing strategies and tactics that resonate with their target audience.
(iii)Resource allocation: Marketing planning enables businesses to allocate their marketing resources effectively. It involves setting marketing budgets, determining resource needs, and prioritizing marketing activities. By having a well-defined plan, businesses can allocate their budgets and resources to the most impactful marketing initiatives.
(iv)Evaluation and control: Marketing planning provides a framework for evaluating and controlling marketing activities. By establishing specific objectives, targets, and key performance indicators (KPIs), businesses can measure the effectiveness and efficiency of their marketing efforts.
Intensive distribution: Intensive distribution is a strategy where a product is made available in as many outlets as possible within a given market. The goal is to maximize the product’s availability and accessibility to customers. This approach is often used for fast-moving consumer goods (FMCG) or low-cost items that have high demand. WHILE
Exclusive distribution: Exclusive distribution, on the other hand, is a strategy where a product is made available only through a limited number of carefully selected outlets within a specific market. This approach is commonly used for premium or luxury products, where maintaining control over the distribution channel is critical.
(i)Facilitating the physical movement of products: One of the primary functions of distribution channels is to ensure the efficient and timely movement of products from the point of production to the point of consumption. This involves activities such as transportation, warehousing, inventory management, and order fulfillment. Distribution channels help ensure that products are available in the right quantities, at the right locations, and at the right time.
(ii) Providing market coverage and accessibility: Distribution channels help overcome the geographical barriers between producers and consumers by expanding the reach and accessibility of products. They establish an extensive network of intermediaries, such as wholesalers, retailers, agents, and e-commerce platforms, that have direct access to customers in various locations and market segments. This allows producers to tap into new markets, increase market penetration, and reach a wider customer base.
(iii)Adding value through assortment and assortment functions: Distribution channels contribute to the creation of customer value by providing a wide assortment of products and services in one place. Retailers, for example, curate a range of products from different producers, giving customers the convenience of one-stop shopping. Distribution channels also perform assortment functions such as sorting, grading, and packaging, which enhances the appeal and value of products to customers. They ensure that products are readily available, properly packaged, and in suitable quantities, making them more appealing to consumers.
(iv) Facilitating communication and customer service: Distribution channels serve as a vital communication link between producers and consumers. They gather market intelligence, feedback, and insights from customers and provide them to producers, helping them make informed decisions. Channels also play a role in promotional activities, advertising, and personal selling, effectively communicating product features, benefits, and promotions to customers. Additionally, distribution channels provide customer support, after-sales service, and assistance, building customer trust, and satisfaction.
(i) Cost of production: The cost of producing a product is a significant factor that influences its price. This includes raw material costs, labor costs, manufacturing overheads, and any other expenses incurred in the production process. The higher the production cost, the higher the price of the product is likely to be.
(ii) Supply and demand: The relationship between supply and demand plays a crucial role in determining product prices. If the demand for a product is high and the supply is limited, the price tends to increase. Conversely, if the supply exceeds the demand, the price may decrease to stimulate sales.
(iii) Competition: The level of competition in the market also affects the pricing of a product. In a competitive market, businesses may lower their prices to attract customers and gain a larger market share. On the other hand, if a product has unique features or a strong brand reputation, businesses may set higher prices due to the perceived value.
(iv) Target market and consumer behavior: The target market and consumer behavior have a significant impact on pricing decisions. Different consumer segments have varying purchasing power and willingness to pay. Businesses often adjust prices based on factors such as income levels, demographic characteristics and buying habits of their target customers.
(v) External factors: External factors such as inflation, exchange rates, taxation, and government regulations can also influence product pricing. Inflationary pressures can increase production costs, leading to price increases. Changes in exchange rates can affect the cost of imported goods, which can be reflected in the selling price. Government regulations, such as taxes or import tariffs, can also impact prices by directly adding expenses to the product.
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